New source of income should be found

The ministers have started saying openly that the state is facing an unprecedented financial crunch. Discussing the issue in the cabinet meet is quite natural. There is nothing new in the opinion of the ministers that many of the projects will be cut short. Whenever the treasury faces a financial crisis, the projects will be cut short first. It is better not to mention the difficulties of going ahead with fixed income when the borrowing limit is severely curtailed by the centre and the allocation from them in various categories decreases due to various reasons. It is not certain what new ways the finance minister will adopt to raise revenue in the budget to be presented in three weeks. With the implementation of GST, there is less possibility of raising revenue by imposing additional taxes.

If the pending taxes are collected fully, there would not be so much financial crunch. It is estimated that Rs 40,000 crore has to be collected including tax arrears. Three years ago, it was Rs 24,175 crore. With each passing year, there is a huge jump in the amount to be collected. Investors will come forward to invest money only if business friendly environment is maintained. The claim of the industries department that one lakh industrial units have started functioning here in the last one year is certainly a good sign.

Of the Rs 40,000 crore that should reach the exchequer, the lion’s share is from the government departments. The government pays Rs 40-50 crores to KSRTC every month for salary at the same time when the corporation owes Rs 1796 crore to the government in motor vehicle tax. Apart from this, a hefty share is also earmarked in the annual budget. Similarly, KSEB on duty owes Rs 1486 crore to the government. There are GST arrears of Rs 13395 crore involved in case and disputes. Similarly, other major departments are also indebted to the government with huge sums. Other new sources of income will emerge only if the financial department thinks differently from the traditional ways, rather than taking a loan every month to pay salaries, pensions and other essential expenses.

A change is needed in the approach of receiving praises by giving freebies. Foreign universities are likely to come up in the country and we should be able to welcome them. Any type of new projects has to be profitable.