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Fiscal crisis to linger on: Finance Minister Thomas Isaac

Congress's K.C. Joseph called Mr Isaac a lucky man.

THIRUVANANTHAPURAM: The fiscal condition of the state will remain troubled for two more years. Finance minister Dr T.M. Thomas Isaac said in the Assembly on Monday that growth in tax revenues showed no signs of reviving this fiscal. “And once the GST comes into force from April 1, 2017, the inaugural fiscal year (2017-18) is expected to be tough in terms of revenues," the finance minister said while replying to the discussion and voting on supplementary demands for grants in the budget in the Assembly.

Mr Isaac chalked up the poor revenue growth during 2016-17 to the administrative anarchy that according to him had prevailed during the UDF tenure. "Not a single tax commissioner stayed in the post for more than six months during the UDF tenure," Mr Isaac said. "Similar was the case with tax officials posted at crucial locations," he added. Though there was a spurt in tax growth to 19 per cent during June, the first month Isaac was in power, the remaining months had belied the initial optimism.

Congress’s K.C. Joseph called Mr Isaac a lucky man. "Last time when you took over there was VAT. Now, you have the boon of GST," Mr Joseph said. Mr Isaac responded that GST would not bring the state any luck at least during the first year. "This means that revival will begin only after two fiscals," he said. In his first budget, Mr Isaac had estimated a tax growth of 19 per cent. Now he has tempered his estimate to 14 per cent. His hope of getting compensated by the Centre has been deflated after the GST Council decided to provide compensation to states only if annual tax growth falls below 14 per cent.

Rs 4,000-cr projects: Mr Isaac said that the first board meeting of Kerala Infrastructure Investment Fund Board, which would be held on November 7, would sanction projects worth Rs 4,000 crore. A large chunk of the first KIIF-B tranche will be utilised for road works, construction of schools and hospitals, and drinking water projects. The target is to disburse Rs 20,000 crore through KIIF-B for development works this fiscal.

( Source : Deccan Chronicle. )
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