THIRUVANANTHAPURAM: Kerala gets Rs 21, while UP gets Rs 46 and Bihar gets Rs 70 from every Rs 100 collected as tax from these states, said Finance Minister KN Balagopal while presenting the State Budget 2024-25 on Monday. The minister said this while explaining the reasons behind the severe financial crisis faced by the state.
"Then why is there a financial crisis despite this much increase in the state's own tax collection? Our total tax revenue includes Kerala's eligible tax share from the tax collected by the Centre. The details of the same are given in the State Finances Report of Reserve Bank of India.
As per the statistics of 2021-23, on national average, the Centre will provide Rs 35 for every Rs 65 collected by the respective states. But the Centre provides only Rs 21 against Kerala's own tax collection of every Rs 79. That is, only Rs 21 out of Rs 100 is the Centre's contribution. Uttar Pradesh gets Rs 46 out of Rs 100 from the Centre. Bihar gets Rs 70 out of Rs 100," he said.
"Do we need any other better proof than the statistics of RBI? In the divisible pool of tax collected by the Centre, which is to be devolved among the states, 3.87 pc was Kerala's share during the 10th Finance Commission period. This has come down to 2.5 pc in the 14th Finance Commission and to 1.925 pc in the 15th Finance Commission. It is now a well-known fact that Kerala has lost tens of thousands of crores as a result of this. We told that to the people," he added.
Balagopal said Kerala was getting punished for its developmental achievements. "The people of Kerala are being punished for their high per capita income and controlled population growth. But the Centre is pretending not to see the serious second generation development problems that have arisen as a result of economic growth. This does not take into account the rise in lifestyle diseases and the increasing proportion of elderly people," he said.
As per the Centre's own guidelines, Kerala's eligible borrowing limit for 2023-24 is Rs 39,626 crore. But sanction was given only for Rs 28,830 crore. Kerala faced a total loss of Rs 57,400 crore due to the Centre's policies. Of this, Rs 12,000 crore was due to the cessation of GST compensation. There was a shortfall of Rs 8,400 crore in this year's Revenue Deficit Grant. Rs 7,000 crore was adjusted from market borrowing limit citing borrowings made by the KIIFB and KSSPL. There was a shortfall of Rs 18,000 crore owing to the decline in the state's divisible pool share from 3.87 pc to 1.925 pc.
Balagopal alleged that there was a conspiracy to destroy the Kerala development model which is based on the concept of the welfare state. The conspirators aim to deny welfare pensions, ration goods and other subsidised supply of food items, he said.
