PCI wants J&K to improve tax base for healthy plan

Sanjeev Pargal
JAMMU, Jan 23: The Finance Division of the Planning Commission of India today held an in-depth discussion with Administrative Secretaries of Planning and Development and Finance Departments of the State through video conferencing and discussed “financial resources” of Jammu and Kashmir for the next financial year of 2014-15 for funding the annual plan.
Principal Secretary of Planning and Development Department, BR Sharma and Principal Secretary of Finance Department BB Vyas attended the meeting through video conferencing on behalf of the State Government with Finance Division of the Planning Commission, represented by Advisors and other senior officers of the PCI.
Official sources told the Excelsior that the top officials of Planning and Finance Departments presented “financial resource position” of Jammu and Kashmir that mainly pertained to “tax collection of its own resources” during current financial year of 2013-14 and the likely targets for next fiscal year of 2014-15.
“The Planning Commission had to take into account `resource position’ of the State before funding the annual plan,” sources said, adding that Jammu and Kashmir was likely to achieve record revenue from all State taxes including Commercial Tax, Sales Tax, Value Added Tax, Excise Tax, Motor Spirits Tax, Entertainment Tax etc. Revenue collected as power or water tax is not included in the tax revenue
The Government had received about Rs 6000 crores worth revenue from the taxes in Jammu and Kashmir during 2012-13 (the last financial year), which was pegged to grow at least by 10 per cent or even more during 2013-14. The Government has assured the Planning Commission of India of hefty increase in its tax revenue during 2014-15 without hitting the common man.
Sources said the Planning Commission also wanted the State Government to reduce the widening gap between power tariff collection and expenditure on purchase of electricity. It was in view of the directive that the Government has already increase revenue target of the Power Development Department (PDD) for current financial year from Rs 2340 crores to Rs 2800 crores as against just Rs 1450 crores recovered during 2012-13.
Though it would be an uphill task for the PDD to recover Rs 2800 crores worth revenue in the current fiscal, the Government had to spend around Rs 4000 crores on account of power purchase bill.
Sources said the State Government presented in detail its tax base position for current as well as next financial year, the Planning Commission wanted it to improve further. The State has assured the Planning Commission that it would do its best to improve the resources in a way that the common man was not burdened heavily.
It may be mentioned here that the State Government had sought meetings with the Planning Commission of India as it has decided to present full budget in the Legislature in the month of February before the Election Commission of India imposed Model Code of Conduct for the Lok Sabha elections.
The Government wanted to get tentative figures from the Planning Commission of India on next financial year’s annual plan and Prime Minister’s Re-construction Plan (PMRP) to include them in the budget. Sources said after ascertaining the resource position of Jammu and Kashmir, the Planning Commission could give tentative figures of annual plan and PMRP to the State officials to facilitate the Government in presentation of full budget.
The State Government was likely to seek higher plan for 2013-14 as against Rs 7300 crores given to it by the Planning Commission during 2012-13 and 2013-14. In 2012-13, the Planning Commission had imposed a cut of Rs 1500 crores reducing the plan to mere Rs 5800 crores. This year also, the Planning Commission wanted to give only Rs 5800 crores worth plan to the State but following reservations expressed by the Government it was raised to Rs 7300 crores.
Apart from the annual plan, the State was assured Rs 600 crores under the PMRP.
Sources hoped that the Planning Commission would approve anything above Rs 7500 crores as its annual plan for next financial year. They, however, said that if there was a change of Government at the Centre after the general elections in April-May, there would be an altogether new Planning Commission and the State would have to present its case once again for annual plan and PMRP.

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