FM clarifies reason for not imposing taxes despite financial crisis

THIRUVANANTHAPURAM: Finance Minister K N Balagopal said the state's financial situation is not in a good condition. He said ban on notes, improper implementation of GST, Ockhi, floods, first and second waves of the pandemic, recession had adversely affected non-tax revenue.

Income growth rates have hit a recent low. However, government spending has not declined, it has increased. He said this is natural in times of crisis.

Nothing in the last budget of the first Pinarayi government has been changed in the new budget. More things have been added. In a press meet held after the budget presentation, the finance minister said the budget gave more importance to the health sector at a time when Covid cases are increasing.

Even though tax increase is inevitable in the state’s financial situation, no new tax proposals are announced considering the pandemic situation However, no one can pay taxes when all areas are closed due to the lockdown. Therefore, no new tax has been introduced in the budget, the minister explained.

The minister demanded the Central Finance Commission to change their approach of disbursing money to the states. Earlier, the Centre had given a fair share to the states on the basis of population and economic factors. Kerala sincerely reduced its population and made great strides in the economy. Per capita income also increased. The finance minister said that these gains were against the central share and was a problem raised by many states.

With the arrival of GST, it is as if our strength is on their side. 4,077 crore is due from the Centre. The economy has been active in the United States and Europe since the first vaccine was given. The spread of the disease can be controlled once the vaccine reaches the maximum number of people in the state. More people will come to Kerala. With this, tourism will be active, he added.