Kerala Govt Places Budget: All You Need to Know

A new airport in Sabarimala is under consideration

Kerala Finance Minister Thomas Isaac 

(Photo Courtesy: The News Minute)

Movie tickets and beer and wine prices are to be hiked and a 'flood cess' slapped in cash-strapped Kerala as the CPI(M)-led LDF government presented its first post-flood budget on Thursday, 31 January, in an effort to mobilise additional resources to rebuild the state. The budget was placed in the Assembly by the state’s Finance Minister Thomas Isaac.

As the southern state faced a severe financial crunch, Finance Minister TM Thomas Isaac presented the budget for the 2019-2020 fiscal, giving thrust to a massive rebuilding exercise – 25 new projects are proposed to resurrect Kerala after the devastation caused by the deadliest flood of the century last August.

On 30 January, the state’s economic survey revealed that Kerala’s Gross State Domestic Product (GSDP) grew from 6.22 percent (2016-2017) to 7.18 percent (2017-2018), according to news agency IANS.

Among major announcements in the budget, Rs 20 crore has been earmarked to make Kerala a ‘hunger-free state’, The Times of India reported.

Seeking to mobilise additional revenue, a 0.25 percent "flood cess" would be levied on all goods coming under the Fifth schedule, including gold, silver and platinum ornaments on the value of supply, Thomas Isaac said.

"For supply of goods coming within the GST, the tax bracket of 12 percent, 18 percent and 28 percent and on all services, one percent flood cess will be imposed on the value of supply. This will be levied for a period of two years," he said, adding Rs 600 crore additional revenue per–year is expected through this measure.

The budget proposed to increase by two percent, the tax rate on first sale of all kinds of foreign liquor, including beer and wine, which is expected to mobilise an additional revenue of Rs 180 crore.

Watching movies in theatres is also set to cost more as the budget proposed that local bodies permit levy of 10 percent 'entertainment tax' on tickets.

“As per the recommendation of the GST Council, the GST rate of cinema tickets was brought down to 18 percent from 28 percent. As such, the local bodies will be permitted to levy 10 percent entertainment tax on cinema tickets.”

Thomas Isaac, Finance Minister, Kerala 

Amid the Sabarimala controversy, the government has made plans of an airport there. A further Rs 629 crore has been allocated for roads in Sabarimala, the TOI report said.

The government has also announced an allocation of Rs 1,420 crore in special schemes for women empowerment, The News Minute reported. Transgender persons will also now be enabled to be part of Kerala Women's Development Corporation schemes.

Other big allocations include Rs 2,500 crore for the agricultural sector, Rs 1,366 crore announced for the Public Works and Rs 1,000 crore announced for Kudumbashree mission.

As an alternative to the Centre's much-hyped "Ayushman Bharat' scheme, a comprehensive health insurance scheme, seeking to ensure health security to all families, was proposed in the fourth budget of the Left government.

Fulfilling the long-pending demand of the expatriate community, the budget proposed that the Department of Non Resident Keralites Affairs (NORKA) would bear expenses to transport bodies of deceased expatriates from the Gulf region to the state.

All welfare pensions have been hiked by Rs 100, giving solace to lakhs of beneficiaries.

Isaac said the total budget outlay has been pegged at Rs 1.42 lakh crore.

Even during the financial crisis, the expected plan outlay for 2019-20 has been raised to Rs 39,807 crore from Rs 32,564 crore.

(With inputs from The News Minute, PTI and IANS)