Budget 2011-12: Entry tax on food items exempted

Bhubaneswar: With a thrust on inclusive growth and infrastructure development, state government on Friday presented a balanced Rs 46,047.75 crore budget for 2011-12 which exempted entry tax on several food items in view of inflation.

Presenting the budget in assembly, finance minister Prafulla Ghadai said in order to provide relief to consumers and contain inflationary impact on food items, it is proposed to exempt entry tax of one per cent on onion, garlic, ginger, potato, egg, fruits, fish, cattle feed, prawn feed, peas and in packaged form, banana and poultry.

"I am sure the price of these commodities will be reduced and commoners will be benefited," he said.

The finance minister, however, proposed hike of VAT from 12.5 per cent to 13.5 per cent on 30 items including cars, refrigerators, ACs, electrical items, televisions, hardware, tobacco and mobile sets.

About Rs 150 crore is expected to be earned by raising the VAT while the state government could lose Rs 20 to Rs 25 crore by exempting entry tax on food items, Ghadai said.

In a bid to strengthen infrastructure in the state, the budget for the first time proposed to provide Rs 100 crore for planning and coordination department for creation of a state viability gap fund. "It will attract more and more private investors for the key infrastructure projects in the state," he said.

Besides, Rs 43 crore has been provided in the budget of energy department towards viability gap funding of non-remunerative transmission projects to be implemented in backward KBK and tribal districts, the finance minister said.

The budget also proposed to provide Rs 30 crore for works department towards land acquisition for PPP projects in road sector, he said.

The total plan size of the state was fixed at Rs 15,000 crore for 2011-12 which included an outlay of Rs 13000 crore for state sector and Rs 2000 crore for public sector undertakings, Ghadai said adding that non-plan expenditure was estimated at Rs 29,594.25 crore.