Chandigarh, June 18
As the state is facing a serious financial resources squeeze, there will hardly be any scope for Punjab finance minister Manpreet Badal to present a path-breaking budget in the state assembly on June 20.

As Manpreet Badal will be presenting his maiden budget on that day, a testing time is ahead for him.

What is confirmed with regard to the budget is enhanced allocation for the education, health, irrigation and power sectors. In their manifestos, the SAD-BJP combine had made a promise to improve the education and health sectors and increase power generation.

Against the committed expenditure of Rs 9,000 crore, the state government has a revenue of Rs 10,000 crore. Besides the committed expenditure, the government is to provide Rs 550 crore for various municipal committees for development in lieu of octroi that was abolished last year. And then the bill for power subsidy to farmers and poor sections of society is expected to shoot up to Rs 2,400 crore during the current financial year from the existing Rs 1,600 crore.

Then Rs 500 crore is required for the atta-dal scheme. And there will be a decline of about Rs 400 crore in the devolution of funds from the union government during the current year. The dilemma being faced by the finance minister and the Chief Minister is how the government should tackle the new financial liabilities. Except levying taxes, there is no escape. Sources said that tax was likely to be levied on mega projects related to luxury housing, mining of sand and gravel, etc. No tax proposal was likely to hit the common man.

“ There is hardly any elbow room for me to do something extraordinary. However, I will try my best to live up to the expectations of people”, said Manpreet Badal, replying to a question regarding the philosophy behind his maiden budget. “I want to jack up the state development plan to Rs 10,000 crore in the next five years from Rs 5,111 crore at present”, he added. Haryana’s plan was already pegged at Rs 10,000 crore. “So, we are far behind Haryana”.

“And then Haryana’s collection from VAT is in the range of Rs 7,200 crore whereas ours is only Rs 5,200 crore despite the fact that Punjab is an out- and-out consumer-oriented state”, he added. “Where is the money, which should come to the state treasury from VAT, disappearing? That is my major concern. By plugging holes in VAT collection, we can certainly collect Rs 10,000 crore from that tax”, he added.

However, Manpreet Badal will not be able to do much as far as improving the collection of tax is concerned. In Punjab, the tax department is not clubbed with the finance department.

Only by placing the finance and tax departments under the control of one minister can tax collection and fiscal management improve.