'Punjab one of slowest growing states'

<div class="section1"><div class="Normal"><span style="" font-family:="" arial="" font-size:="">CHANDIGARH: Inspite of the tall claims made by the Punjab government in its annual budget on Monday, the state''s economy refuses to show signs of improvement. </span><br /><br /><span style="" font-family:="" arial="" font-size:="">In its projections for the Tenth Five-year Plan, the Planning Commission has projected Punjab as one of the four slowest growing states in the country.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">With four per cent growth rate recorded in Punjab, as against the average six per cent at the national level, the commission has warned that if the deceleration in the growth rate is left unchecked, employment generation and income would be adversely affected.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">The medium term fiscal reform programme, introduced in 2002-03 as a part of the state''s exercise to discipline revenue and fiscal deficit, has brought little cheer to the financial managers.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">The fiscal deficit as percentage of the gross state domestic product (GSDP) instead of declining was recorded as 7.23 per cent in 2003-04 as against 6.03 per cent in 2002-03.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">During the current financial year, it is expected to hover around 6.79 per cent, which would be still higher than what it was in 2002-03.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">In 2005-06, it is expected to touch 6.07 per cent and dip still further in 2006-07 to 5.36 per cent.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">This would be achieved only if the state records growth rate of six to 6.5 per cent with inflation remaining around five per cent.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">High expectations?</span><br /><br /><span style="" font-family:="" arial="" font-size:="">While finance minister Lal Singh, in his budget, has preferred not to levy any taxes or initiate tax reforms, the medium term fiscal reforms appraisal report, tabled in the Vidhan Sabha on Monday, explicitly points out that the tax collections have not kept pace with the growth of the GSDP.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">It suggested that the rate of growth of taxes be pegged to the expected rate of growth of the economy.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">This would require widening of the tax base, increased tax collection efficiency and improved administration.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">As the minister has not ventured into sales tax restructuring in the budget, his emphasis instead would be on plugging the leakages in tax collection to affect a increase of about Rs 1000 compared to last year.</span><br /><br /><span style="" font-family:="" arial="" font-size:="">In order to enhance revenue collection from motor vehicle tax and stamps as well as registration, the budget outlines no proposals except for saying that there was potential to get more returns from the two taxes.</span></div> </div>