Chennai: Four days before his first budget, Minister of Finance Tamil Nadu Palanivel Thiaga Rajan on Monday presented white paper on state finances, advocating “once in generation reform” to exit the “unsustainable fiscal situation”, blamed on “reckless economic management “From the previous AIDMK government.
He recorded the fall of the country from a revenue surplus of 1,760 crore at 2012-13 to the Deficit RS 61,320 Crore at 2020-21.
The state needs to avoid business approaches – as usual and adopt radical reform, he said, especially in sectors such as power, water supply and transportation.
“The budget that I will face this Friday is practically for six months.
Therefore someone cannot say how many changes can be included in this exercise.
In the future, bitter drugs will be delivered correctly for personal interests that exploit state revenue for their personal benefits.
Through wise steps, we are sure to improve the Mistakes of the AIDMK government and fulfill all promises of polls made by our main minister in this five-year term, “Minister said.
Showed that vehicle tax and other costs, was collected as a fixed cost, still unchanged for 15 years, Thiaga Rajan questioned the uniform approach to rich and poor people while collecting the last property tax revised in 2008.
The cost of water relook, he indicated, at where large consumers must pay higher taxes.
This also applies to electricity, with the need to prevent large consumers benefit more than the demands subsidized.
The accumulated debt of the electricity sector and transportation of PSUs reached Rs 1.99 Lakh Crore on March 31, 2021, while the accumulation of losses from two water boards amounted to RS 5,282.57 Crore at the end of the last financial year.
Experts see white paper as the beginning of large reforms.
“It makes a case for an increase in property tax and rationalization of electricity and transportation subsidies.
The latter may be difficult to achieve considering that the country aims to become a major player in the manufacture and use of electric vehicles.
The increase in electronic runner costs e-vehicle can have a negative impact on adoption, “Vidya Mahambare said, the economic professor at the Great Lakes Institute of Management.
The focus is now on the first budget by the DMK government on Friday, after returning to power after a decade.
“Fiscal transformation will occur if their powerful will is indicated by stopping the scheme such as free power and loose fiscal management.
I believe there will be, because the last state goes to TN!” Tweeted Gopal Srinivasan, chairman of the TV capital fund.
The current level of fiscal deficit is not sustainable because the income deficit section in the fiscal deficit exceeds 50% or more since 2017-18.
Even though in most years, since 2013-14, the fiscal deficit was maintained within a 3% limit of prescribed, it was only obeyed by delaying certain expenditure items, he said.
The increase in fiscal deficit driven deficit deficit funded mainly by borrowing, which sharply increased total debt (visible) circulating to a little more than Rs 5.70 lakh crore on March 31, 2022, amounting to RS 70,000 in every citizen and almost Rs 2 , 64 lakh in every family living in Tamil Nadu.
The gap that develops between fiscal deficits and net public debt every year has been borne by transactions in public accounts and cash balance withdrawals.
The total government guarantee almost doubled to over ₹ 91,800 crore in 2020-21, which means the obligation of large contingents and fiscal risk for the country.
In 2019-20, Tamil Nadu has the third highest guarantee circulating among all states, behind Telangana and Andhra Pradesh, countries through Pang Division.