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No fresh taxes in Maharashtra budget, rural economy to get a boost

In a budget speech marred by unprecedented sloganeering by the opposition Congress-NCP combine seeking loan waivers for farmers, Mungantiwar refrained from announcing fresh taxes or populist projects.

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MoS Finance Deepak Kesarkar and State Finance Minister Sudhir Mungantiwar with the budget outside Vidhan Bhavan on Friday
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Trying to administer a booster shot to the state’s ailing agriculture sector, Maharashtra Finance Minister Sudhir Mungantiwar unveiled a slew of measures aimed at adding value to rural economy.

In a budget speech marred by unprecedented sloganeering by the opposition Congress-NCP combine seeking loan waivers for farmers, Mungantiwar refrained from announcing fresh taxes or populist projects.

However, foreign liquor, Indian Made Foreign Liquor (IMFL) and country liquor, will become costlier due to an increase in value added tax (VAT), while card swipe machines, milk testing kits, soil testing kits and aviation turbine fuel (ATF) for aircraft operating at Maharashtra’s 10 small airports under the regional air connectivity scheme will become cheaper.

With the Goods and Services Tax (GST) all set to be implemented from July 1, 2017, the state aims at generating additional revenues through non-tax sources such as court fees and charges for services.

Mungantiwar announced allocations for memorials of Chhatrapati Shivaji Maharaj (Arabian Sea), Dr Babasaheb Ambedkar (Indu Mills, Dadar), the late Shiv Sena chief Bal Thackeray (Mayor’s Bungalow) and warrior queen Ahilyadevi Holkar (Ahmednagar).

It will also develop tourist and pilgrimage centres such as Mahurgad, Jyotiba, Lonar and Sindhudurg and Raigad forts.Presenting his third budget on Saturday, Mungantiwar did not heed demands for writing-off Rs 30,500 crore crop loans to free 31.57 lakh farmers from debt. 

“The state government has increased investment in agriculture sector so that the farmer comes out of the debt trap. If the huge collective indebtedness is to be written off, it will have an impact on investment in the agriculture sector. Further, there is no assurance that farmers will be perennially out of the debt trap,” he noted. The state government, he said, had sought Central assistance in this regard.

The state plans to double agricultural income by 2021.

The budget provided Rs 8,233 crore for irrigation, Rs 979.10 crore to energise agricultural pumps, Rs 1,200 crore for the Jalyukta Shivaar water conservation programme and Rs 250 crore for the Krishna-Marathwada project to irrigate 25,798 hectare and 8,147 hectare in parched Osmanabad and Beed respectively.

The government will exempt Rs 700 crore sugarcane purchase tax levied on sugar factories to enable them to pay remunerative prices to farmers.

“Infrastructure development is a crucial objective of this government. However, investments in infrastructure require a large sum of capital. In the next five years, we approximately envisage a requirement of Rs 1 lakh crore to finance capital expenditure of key infrastructure projects,” said Mungantiwar.

He announced an infrastructure fund for which a separate SPV—MAHAINFRA--a single-window for aggregating the land held by various departments would be established.

Unused land, which will not be developed for 10 years, will be securitised for fund generation through low-cost loans, bonds or investments from large investors.

The budget also proposed developing cancer treatment centres at revenue headquarters. The state will upgrade the Marathwada Cancer Centre at Aurangabad to a state-level cancer institute, and for Rs 126 crore have been earmarked for it.

“Breast, uterus and oral cancers are the most common form of cancers. Early detection and treatment leads to improvement in 75 per cent of cases and reduces cancer fatalities,” said Mungantiwar, adding it was proposed to introduce mammography machines and medical equipment in 253 government medical hospitals and rural hospitals. CT scan machines will also be installed at a cost of Rs 54 crore in 31 hospitals for detection of ailments.

The ‘Asmita’ scheme will provide sanitary napkins at subsidised rates to girls studying in ZP schools.

Like Mumbai’s CCTV surveillance project, similar systems will be established in Nashik and Kalyan Dombivali.

The budget has proposed a Rs 710 crore outlay for Metro railway projects in Mumbai, Nagpur and Pune including the Colaba-Bandra-Seepz, Dahisar–D.N Nagar and Dahisar–Andheri routes. Funds will be provided for developing airports at Solapur, Karad, Amravati and Chandrapur and ports at Vadhvan near Dahanu.

Mungantiwar rolled out tax reform measures, establishment of three more benches of the Maharashtra Sales Tax Administrative tribunal for early disposal of pending appeals and measures to recover pending dues.
The budget, which will have a Rs 4,511 crore revenue deficit, has estimated revenue receipts of Rs 2,43,737 crore and revenue expenditure of Rs 2,48,248 crore. It has spelt out tax proposals which will result in an additional revenue gain of Rs 396 crore and stressed on fiscal discipline.

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