THIRUVANANTHAPURAM: Minister for Finance T.M. Thomas Isaac said here on Friday that he had adopted a balanced approach in Governmental investments in various sectors in the State budget for 2007-08. The revenue and fiscal deficits had been reduced without affecting growth.

The Minister told presspersons after presentation of the budget that the taxation measures, except one, would not affect the majority of people. The tax on life-saving medicines would not lead to increase in prices, as the medicines were being sold at their maximum retail prices (MRP). The MRP, according to Union Government stipulations, included tax. Prices would not come down just because Kerala alone avoided tax on the medicines.

Noting that his proposals on stamp duty did not amount to an increase in tax rates, Dr. Isaac said that the Government was committed to bringing it down. This would be done when the fair values for land was fixed and notified. He said that his proposal that the non-tax revenue earned by developmental departments by increasing fees, fines and other charges could be allocated to them would cover departments such as education, health, agriculture, industries and social welfare.

He said that capital expenditure proposed in the budget was lower than that shown in the revised Budget for the current year because money had been allocated in the current year for paying dues to contractors. The Government proposed to clear all arrears in payments by next year.

He said that developmental expenditure was actually higher if one considered the revenue expenditure that could be treated as capital expenditure.

Referring to the Opposition criticism that the budget had no proposal for creation of employment, the Minister said that unemployment was proposed to be solved by development of various sectors. It was wrong to allege that the Finance Department was strangling the Public Works Department through the budget proposals. The proposals were made in consultation with Public Works Minister T.U. Kuruvilla.

The suggestions of President A.P.J. Abdul Kalam for the development of the State had not been ignored as alleged by the Opposition. Money had been allocated to areas pointed out by the President.

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