Nagaland CM presents tax-free deficit budget

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Kohima, Feb 18 (PTI) Nagaland Chief Minister Neiphiu Rio on Thursday presented a deficit budget for the financial year 2021-22 without proposing any new tax.

Rio, who also holds the finance portfolio, put forth the budget proposals estimating the gross receipts at Rs 22,451.28 crore and gross expenditure at Rs 22,816.61 crore for 2021-22.

The state government also estimated a deficit of Rs 2,314.13 core by end of the current financial year of 2020-21, he said.

In his budget speech, Rio said that the COVID-19 pandemic has adversely impacted the finances of the state with huge shortfalls in revenues both its own as well as its share in central taxes and duties.

The state government was also compelled to invest from unbudgeted funds to fight the pandemic and the additional expenditure on this is Rs 90 crore so far, he said.

The state's share of central taxes has been reduced in the Revised Estimates of the Union Budget by Rs 1,341.99 crore, he said.

'Our own revenues are also estimated to decline by Rs 86.19 crore,' he said.

The state government has taken various measures to reduce expenditure and managed to save around Rs 400 crore during the year, the chief minister said.

'In view of the difficult situation that we are facing now, I do not propose to raise any new taxes,' said Rio.

However, 'we have to make all possible efforts to increase revenue collections through measures such as better enforcement and steps to check leakage of revenue,' he said.

As a part of this exercise, he said instructions have been issued to all government departments not to award any supply orders or works contract to firms or contractors who are not registered with the Taxes Department to reduce scope for evasion of taxes.

Efforts are also being made in sectors like forests, geology and mining to tighten control and supervision of government agencies over trade in minerals and various natural resources, he said.

To support ideas and ambitions and innovations at all levels and in order to push employment generation, the government is keeping Rs 34 crore under the Innovative Programmes & Activities Initiative.

The chief minister fixed the State Developmental Outlay for 2021-22 at Rs 700 crore, which is an increase of 9.55% over the Plan size of 2020-21.

'This has been done even at the cost of increasing the deficit, because we are passing through a time when the economy needs adequate capital investment to provide an impetus for the much needed growth to take place,' he said.

Rio expressed hope that during 2021-22 the countrys economy will bounce back to its full potential and Nagaland will get an opportunity to make up for the time that has been lost.

'For a resource-strapped state like ours, we are heavily dependent on Centrally Sponsored Schemes for most of the developmental activities,' he said adding that to ensure a smooth flow of Central funds, he has allocated Rs 250 crore towards State Matching Share for Central Schemes including that of DoNER and NEC.

This will enable the state to access greater funding under CSS programmes to boost the pace of our development, he said.

Under 15th Finance Commission Awards, several projects for improvement of health infrastructure, road maintenance, construction of the high court complex, new Raj Bhavan, mini landing strips and improvement of facilities for fire services in districts will be taken up from 2021-22 onwards, he said.