J&K's tax base set to cross Rs 3500 crore26 December 2010
The Daily Excelsior
JAMMU: Notwithstanding over three month long turmoil in the Kashmir valley this summer which took a toll of more than 100 lives, the has gone up considerably during about nine months of this financial year and was expected to pick up further in the remaining last quarter of the year. In commercial taxes alone, J&K's tax base has widened and touched Rs 1700 crore in less than nine months of this year, which was an all time high. This excludes the tax revenue from excise, which was expected to cross the target of Rs 670 crore this fiscal and touch around Rs 700 crore. Official sources told the Excelsior that three month long agitation in the Valley didn't appear to have caused any impact on collection of commercial and other taxes, whose recovery has shown a 19 per cent increase over the corresponding period last year till date. Commercial taxes have netted Rs 1700 crore in the Government exchequer as against Rs 2230 crore collected during complete financial year of 2009-10. As a full quarter of the financial year of 2010-11 was pending when maximum tax collection is made, the authorities were anticipating the tax base to go much beyond Rs 2230 crore. 'Going by 19 per cent increase in collection of commercial taxes, which comprised Valued Added Tax (VAT), Sales Tax (ST), entry tax and passenger tax etc, the taxes could easily surpass Rs 2700 crore', sources said, adding the possibility of commercial tax base going up to Rs 3000 crore during the current financial year is also not ruled out. The Excise tax has already crossed Rs 400 crore against the target of Rs 670 crore fixed for this year. The Government was, however, expecting Rs 700 crore revenue from the Excise Department for current financial year. Majority of the revenue in Excise Department comes from Jammu region where most of this trade is spread. Sources said the commercial and excise taxes alone were expected to stand between Rs 3500 crore to Rs 3700 crore this year, which would not only be all time high but beyond expectation of the Government. Such a massive tax base comes in the year when a complete region (the Kashmir valley) was gripped by massive trouble for more than one quarter of the year. However, it was the electricity supply, which continued to eat into major tax base of the State. During this financial year, the Government was anticipating an expenditure of Rs 2500 crore on electricity purchase as against the maximum revenue of Rs 1000 crore. This will leave a gap of Rs 1500 crore uncovered and had to be met by the Government from the other expanding tax base. According to sources, all out efforts by the State Government including installation of electronic meters in City and some urban areas have also failed to fill the gap between power purchase bill and revenue. Even though the State's revenue from power has almost doubled in last two-three years, from Rs 450 crore to Rs 960 crore, it was far less than the power purchase bill. The Government during this financial year was expecting Rs 1000 crore revenue from the power sector, which would also be an all time high. The Central Government had given Jammu and Kashmir Government a special grant of Rs 1300 crore each (Rs 3900 crore for three consecutive years) during 2006-07, 2007-08 and 2008-09 in the tenure of the then Chief Minister Ghulam Nabi Azad. The grant was discontinued with the departure of Mr Azad from the State to the Centre where he is currently the Union Minister for Health and Family Welfare.