Thiruvananthapuram: Movie tickets and beer and wine prices are to be hiked and a 'flood cess' slapped in cash-strapped Kerala as the CPI(M)-led LDF government presented its first post-flood budget Thursday in an effort to mobilise additional resources to rebuild the state.
As the state faced a severe financial crunch, Finance Minister T M Thomas Isaac presented the budget for the 2019-20 fiscal, giving thrust to a massive rebuilding exercise.
He proposed 25 new projects to resurrect Kerala after the devastation caused by the deadliest flood of the century last August.
"This is a budget for creating a new Kerala," Isaac said stating that Rs 1,000 crore has been earmarked for the 'Rebuild Kerala' initiative in the plan.
The government earmarked Rs 1,000 crore for Kuttanad package and a similar amount for fisherfolk.
Isaac invoked Sree Narayana Guru and Kumaran Asan as he started his budget presentation. "Post floods, rebuilding is a challenge before us. After floods, Sabarimala violence was the second disaster in the state," he added.
Seeking to mobilise additional revenue, a 0.25 per cent 'flood cess' would be levied on all goods coming under the Fifth schedule, including gold, silver and platinum ornaments on the value of supply, the minister said.
"For supply of goods coming within the GST, the tax bracket of 12 per cent, 18 per cent and 28 per cent and on all services, one per cent flood cess will be imposed on the value of supply. This will be levied for a period of two years," he said, adding Rs 600 crore additional revenue per year is expected through this measure.
The budget proposed to increase by two per cent, the tax rate on first sale of all kinds of foreign liquor, including beer and wine, which is expected to mobilise an additional revenue of Rs 180 crore.
Watching movies in theatres is also set to cost more as the budget proposed that local bodies permit levy of 10 per cent 'entertainment tax' on tickets.
"As per the recommendation of the GST Council, the GST rate of cinema tickets was brought down to 18 per cent from 28 per cent. As such, the local bodies will be permitted to levy 10 per cent entertainment tax on cinema tickets," Isaac said.
A total of Rs 200 crore additional revenue is expected by levying a one-time tax of one per cent on new motorcycles, motor cars and private service vehicles used for private purpose.
The luxury tax rate for residential buildings are also proposed to be revised.
In order to address increasing atmospheric pollution due to diesel and petrol vehicles, the budget proposed to promote electric vehicles, providing 25 per cent tax concession for five years for such vehicles.
"A 50 per cent concession on tax for five years will be granted to newly registered e-rickshaws," the minister said.
The government also earmarked Rs 739 crore for Sabarimala, the pilgrim centre which witnessed unprecedented protests after the Supreme Court allowed women of all age groups to enter the hill shrine last year.
During his 10th budget presentation, Isaac said that the government, which had suffered backlash over the row, did not even take a single rupee from the Sabarimala revenue.
The Travancore Devaswom Board, which manages the hill shrine, was allotted Rs 100 core. Travancore Devaswom Board president A Padmakumar said that the temple management authority had never received so much funds from a single budget in the past. "The funds allocated for temples excelled our expectations. We will try to launch free buses from Nilakkal to Pamba."
Health insurance
As an alternative to the Centre's much-hyped 'Ayushman Bharat' scheme, a comprehensive health insurance scheme, seeking to ensure health security to all families, was proposed in the fourth budget of the Left government.
All welfare pensions have been hiked by Rs 100, giving solace to lakhs of beneficiaries.
Isaac said the total budget outlay has been pegged at Rs 1.42 lakh crore.
Even during the financial crisis, the expected plan outlay for 2019-20 has been raised to Rs 39,807 crore from Rs 32,564 crore, he added.
Fulfilling the long-pending demand of the expatriate community, the budget proposed that the Department of Non Resident Keralites Affairs (NORKA) would bear expenses to transport bodies of deceased expatriates from the Gulf region to the state.
Various schemes to the tune of Rs 150 crore to benefit the diaspora community of the state were also announced. Isaac said the biggest allocation of Rs 81 crore was for the various programmes of the Loka Kerala Sabha (LKS).
'Lacks planning'
However, the imposition of cess on some goods and services to fund the reconstruction of the state drew sharp criticism from the Congress and the BJP. Opposition leader Ramesh Chennithala said that the budget lacked definite plans for the reconstruction. He also said that the budget has increased the tax burden on a people already bogged down by the flood.
BJP state president P S Sreedharan Pillai termed the budget 'ridiculous'. He said that the finance minister has projected a parallel economic source of revenue and expenditure. "The finance minster is reliant on the KIIFB (Kerala Infrastructure Investment Fund Board) for everything. Isaac hopes to cover up the state's financial crisis with a sleigh of hand," he added.
M Vijayakumar MLA, however, said that the government was able to keep its promises even in these difficult times. Saji Cherian MLA said it was a welfare budget. "About Rs 40,000 crore projects have been approved via the KIIFB. Tenders were invited and many of them have been implemented."
Key budget points
* Gold, silver ornaments slapped with 0.25% cess
* Alcohol, including beer and wine, to cost more after imposing of 2% additional tax
* Moviegoing to cost more - 10% entertainment tax to be imposed
* FM slaps 1% flood cess on items under 12%, 18%, 28% GST slab
* 6 % service tax on earnings in the Rs 20-50 lakh bracket
* Rs 260cr for Employment Generation Schemes
* Rs 260cr for Suchitwa Mission
* Rs 1,000 crore fore KSRTC
* Rs 73cr for Thiruvananthapuram RCC | Rs 35cr for Malabar cancer center
* Rs 739cr for Sabarimala - Rs 200cr for road development; Rs 147.75cr for improving basic facilities at Pamba and Nilakkal
* Rs 100 crore for Travancore Devaswom Board, Rs 36cr for Malabar and Cochin Devaswom Boards
* All welfare pensions to be increased by Rs 100
* Welfare pensions to cost Rs 7,533cr
* 1 lakh tonne cashew to be imported
* Roads to get a facelift: Govt to build 6000-km of roads in two years
* Rs 272cr for developing tourism centres
* Rs 1,296cr earmarked for housing complexes
* Rs 2cr announced for renaissance and women empowerment schemes
* A renaissance museum to be set up in Thiruvananthapuram
* Rs100cr for Nava Kerala mission, 25 new projects to be announced
* Rs 75 cr for Ayyankali Urban Employment Guarantee Scheme
* Rs100 cr for Nava Kerala mission, 25 new projects to be announced
* Kochi-Coimbatore industrial corridor planned
* Rs 500 crore to ensure minimum support price for rubber. CIAL model-company to be set up
* Rs 250cr for Kinfra MegaFood parks
* Rs 250cr for employment guarantee schemes
* Rs 4,500cr for livelihood development schemes
* Rs 75cr for Ayyankali Urban Employment Guarantee Scheme
* Three rice parks to be set up for Rs 20 crore
* Rs 1,000cr for the rehabilitation of fisherfolk
* Rs 20cr to offset crop losses
* Investment of Rs 900 crore via KIIFB in coastal areas
* Fishing harbour Pozhiyoor, TVPM
* Rs 6375 crore via KIIFB to establish power transmission grids
* KSRTC to completely switch over to electric buses
* 10 lakh electric vehicles by 2022
* Construction of high-speed Thiruvananthapuram-Kasaragod railway track to begin this year; 515km high-speed rail track to cost Rs55,000cr
* Rs 12cr for E-mobility fund
* Kerala Bank to be set up this year - to allow deposits by NRIs
* NORKA to bear the transportation expenses of dead bodies from abroad
* Govt to ensure Rs 400-600 daily wages for 25,000 poor women
* Rs1,420cr earmarked for women-empowerment schemes
* Rs20cr for hunger free Kerala
* Kerala Boat League to be launched
