Bill to amend FRBM Act in monsoon session
The state FRBM Act, 2005 needed to be amended in order to incorporate review mechanism in its provisions, Chief Secretary B K Patnaik told reporters.
Stating that the government was likely to get benefit of about Rs 2163 crore after amending the Act, Patnaik said while Rs 1745 crore could be availed as state specific grant, Rs 400 crore would come as debt relief.
However, the state government has to ensure that revenue deficit during the 2011-12 fiscal became zero and fiscal deficit contained within three per cent, he said.
Similarly, the state government had to achieve a balance between the debt and state gross domestic product ratio over the next four years.
While the ratio should be 30.6 in 2011-12, the target for 2012-13 is 30.2 per cent, 29.8 per cent in 2013-14 and 29.5 per cent in 2014-15 fiscal, he said.
On the independent review mechanism, he said that an agency or firm could be appointed to review FRBM.
The state government claimed that it had successfully implemented the FRBM during the 12th Finance Commission period and availed Rs 1200 crore to Rs 1500 crore from the Centre.
"This time also, we are hopeful of achieving the target and get the financial benefits," finance secretary Jugal Mohapatra said.
The cabinet also decided not to implement VAT on sugar and textile products.
"We had not implemented the VAT on sugar and textile.
However, it (4 per cent tax) automatically came into force after the central government withdrew additonal excise duty on the two products," the chief secretary said.
Patnaik said the state government might implement 4 per cent VAT on sugar and textile products in future in the event other states took a similar step.