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State finances in an era of transition Development with care and compassion Curtain Raiser
 
Development with care and compassion
Among the five southern states the budgets of Andhra Pradesh, Karnataka and Telangana were full-fledged. Kerala and Tamil Nadu have presented interim, vote-on-account budgets for 2016-17.

In the full-fledged budgets of the three states the emphasis is on development, welfare and inclusive growth.

 

Table 1: REVENUE AND FISCAL INDICATORS  (Rs. in crore)

 

States                Revenue surplus(+)/ deficit(–)                        Fiscal Deficit

                      2015-2016 (R.E.)    2016-2017 (B.E.)    2015-2016 (R.E.)    2016-2017 (B.E.)

Tamil Nadu            -4616.02                -9154.78               -32359.59               -36740.11

Andhra Pradesh     -41401.11              -4868.26               -11004.91               -20497.15

Telangana             +60.54                 +3718.37               -16911.71               -23467.28

Karnataka             +998.69                +522.01                -20561.00              -25657.00

Kerala                 -10814.49               -9897.45               -17715.06              -19971.08

The overall fiscal position


Except Telangana and Karnataka other states show revenue deficits as in the previous year. Telangana is expected to increase its revenue surplus substantially whereas Karnataka is likely to decline.

Table 2 shows that capital expenditures of all southern states are slated to go up.

VAT has been increased form 14.5 per cent to 20 per cent on aerated and carbonated, non-alcoholic beverages including soft drinks, and soft drink concentrates.

The Kerala budget contains proposals towards simplification of tax collection procedures, concession on certain taxes and some changes in tax rates.

Table 3: Plan Outlay  (Rs. in crore)

States             2015-2016 (R.E.)    2016-2017 (B.E.)       Increase in %

Tamil Nadu               55100.00               60610.00                        10.00

Andhra Pradesh         38671.44              49134.44                        27.06

Telangana                 52383.00              67630.73                        29.11

Karnataka                72597.00              85375.00                        17.60

Kerala                      20000.00              30531.00                       52.66


Tamil Nadu government’s interim budget contains no new taxes.

 

Revenue Mobilisation Efforts

Tamil Nadu – No new tax proposals
Andhra Pradesh – No changes in tax rates. Aims to augment revenues through financial management and ensuring delegation of budget implementation to the last operation unit for the entire financial year.
Telangana – Augment revenue and reduce expenses through rationalisation.
Karnataka – Only state that has announced increased rates on few commodities for additional revenue mobilisation.

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