The Hindu : Front Page : Revenue deficit, tax hike dominate debate

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Tuesday, Jun 27, 2006

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Front Page

Revenue deficit, tax hike dominate debate

Special Correspondent

Assembly begins three-day general discussion on State Budget for 2006-07

THIRUVANANTHAPURAM: Mounting revenue deficit and the hike in the tax rates of a slew of articles proposed by Finance Minister T. M. Thomas Isaac dominated the opening day of the three-day general debate on the State Budget for 2006-07. While the Opposition criticised the Finance Minister for coming up with a revenue deficit on the higher side, the Treasury bench congratulated him for the hike in tax rates on ostentatious consumption.

The day also provided an opportunity to some of the new-comers to make their debut speeches. Opposition members Aryadan Mohammed, V. D. Satheesan, Thomas Chazhikadan and K. C. Joseph, among others, criticised the higher revenue deficit estimates in the Budget.

The Left Democratic Front leader Ramachandran Kadannappally and others welcomed the Budget proposals, particularly the tax hike on ostentatious consumption and the higher allocation for agriculture and traditional sectors. The Congress leader V. D. Satheesan said the Budget spoke only about new projects and did not address key issues facing Kerala's economy. He felt that the hike in tax rates on several commodities was not a sound financial practice. The hike would not address the problems related to tax evasion. He pointed out that Kerala's 9.2 per cent growth rate was contributed mainly by the boom in trade and construction industry. The construction sector alone witnessed an investment of over Rs.10,000 crores during the last five years. The hike in tax rates for tiles and paints would prove to be a setback to the sector. Similarly, the cable TV tax would affect a large number of youths, as it had become an avenue for self-employment.

Some of the Congress and Indian Union Muslim League (IUML) leaders alleged that the Budget had ignored Malabar. But the Communist Party of India (Marxist) member Abdullah Kutty rejected the contention by pointing out the allocation for the Chamravattom project, the Haj House and the Ponnani Fishing Harbour.

K. C. Joseph said a major portion of the Budget speech was spent on criticising the United Democratic Front. The Kerala Congress (M) MLA Thomas Chazhikadan criticised LDF Ministers for using luxurious cars and spending huge amounts on redoing their official residences.

Initiating the debate, a privilege of the Deputy Speaker, Jose Baby wanted a rethink on conducting hartals and bandhs at the drop of a hat. Kerala badly needs investments in industry. Frequent hartals and bandhs would drive capital away. Expressing concern at the increasing suicide rate, including family suicides, Mr. Baby urged the Government to view this as a social problem and initiate discussions to arrest the trend. t

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