Gujarat Finance Minister Nitin Patel on Wednesday presented a revenue surplus budget for 2021-22, without new taxes or tinkering with existing rates.

The Minister projected a revenue surplus of ₹588 crore for the year 2021-22. The existing tax were kept unchanged, while no new tax was introduced considering the impact of Covid-19 lockdown on the economic activities.

GST pick up

Patel, who is also deputy Chief Minister, informed that there would be shortfall in the GST collections for the year 2020-21 owing to the lockdown.

For the first quarter, the GST collections shortfall was recorded at 40 per cent and in the second quarter at 15 per cent. But collections picked up in the October-December quarter by 5 per cent indicating a recovery to pre-covid levels. GST collections in January 2021 touched ₹3,413 crore, the highest ever and the record was broken in February to touch ₹3,514 crore.

This record increase in the GST income gives encouraging indication of economic recovery, Patel said in his budget address.

However, for the year 2020-21, overall GST collections will be down about 10 per cent from previous year. The shortfall is estimated to be about ₹25,000 crore, which will be partially compensated by Cess income of about ₹6,000 crore and Central loan of about ₹9,200 crore.

The State authorities are still looking at a shortfall of about ₹9,000 crore in GST compensation for the year 2020-21.

Debt at record high

On the public debt front, State will raise estimated ₹50,501 crore for the fiscal 2021-22. The gross public debt of the State as on March 31, 2020, was estimated to be ₹2,67,651 crore. Revised estimates showed that during the current fiscal 2020-21, Gujarat had raised ₹61,008 crore in public debt – highest for the State in any year so far. Put together all, projects Gujarat’s public debt to be at ₹3.78-lakh crore at the end of fiscal 2021-22.

The size of the budget for 2021-22 was enhanced to ₹2,27,029 crore, higher by ₹9,742 crore from 2020-21. In the major provisions, Patel has provided ₹32,719 crore for education, ₹11,323 crore for health and family welfare, ₹13,493 crore for urban development, ₹13,034 crore for energy and petrochemicals department and ₹6,599 crore for industries department.

Additionally, the Finance Minister also allocated ₹652 crore for Statue of Unity Area Development.

For the major projects, Patel provisioned ₹568 crore for metro rail projects in Ahmedabad, Surat and Gandhinagar, while it also provided ₹50 crore to plan for metro rail projects in the cities of Vadodara, Rajkot, Bhavnagar and Jamnagar.

Dedicated industrial parks

Patel also mentioned that Gujarat will set up two mega textile parks.

Also, a Bulk Drug Industrial Park will be set up in Jambusar taluka of Bharuch district. Patel also announced a Medical Device Industrial Park to be set up at Rajkot.

Related Topics