THIRUVANANTHAPURAM: Unlike in the past when the state government used to be highly critical of the BJP-led Union Government in the Governor's policy address, this time around there was only some minor criticism against the Centre.
The policy address pointed out that discontinuation of GST compensation, a reduction in revenue deficit grant, and restrictions imposed on off-budget borrowings of the State by the Union exacerbated the fiscal condition of the State. "The State has been constrained to approach the Supreme Court for a solution to the financial impasse thrust on the State. Despite grappling with challenges, the Government remained committed to infrastructure development and growth focused on a knowledge economy, along with sustained social security spending," it said.
The Government has focused on achieving fiscal consolidation on one hand and enhancing domestic revenue mobilization on the other. In 2022-23, the Government successfully raised own tax revenues amounting to Rs. 71,968 Crores, marking an increase of nearly Rs. 13,600 Crores, or 23.4% from the previous year. "According to the Reserve Bank of India, Kerala is among the top performers in revenue mobilization efforts. It is noteworthy that the percentage of own tax revenue that comes from alcohol in Kerala (3.7%) is amongst the lowest of all States and compares very favourably with States where the percentage is as high as 22%," it said.
The Government has the considered opinion that Kerala should be ensured its well deserved share in the distribution of taxes. The policy address also raised concern over holding back of eligible grants and share of assistance in Centrally Sponsored Schemes. "Government is put to added liquidity stress because of the retrospective cut in borrowing limits, which is not in accordance with the accepted recommendations of the 15th Finance Commission. This stand of the Union Government needs an early reconsideration," said the policy address.
