Punjab brings new tax for salaried class
Chandigarh: The Congress-led Punjab government on Saturday proposed a development tax of Rs 200 per month on income tax payees as the budget for 2018-19 focused on fiscal consolidation, with the state finance minister exuding hope of putting economy back on rails over the next two years.
The budget's key focus areas remained agriculture and farmer welfare, industry, health, employees and students.
While presenting the second budget of the Congress government, Finance Minister Manpreet Singh Badal said, "We have tried to mobilise resources and cut down on expenditure".
The total budget size was kept at Rs 1,29,698 crore, though the effective budget size is Rs 1,02,198 crore.
Manpreet Badal proposed raising Rs 1,500 crore through additional resource mobilisation measures. He further informed the Assembly that the government has decided to bring in a legislation for imposing a "nominal development tax" at the rate of Rs 200 per month "only on the Income Tax payees who are engaged in professions, trades, callings and employments".
The new tax will be called 'Punjab Development Tax', under which government is hoping to garner Rs 150 crore annually.
As the state goes for resource mobilisation, Manpreet said the move will help the state access cheaper loans from institutions like Asian Development Bank.
"Many of the progressive states like Maharashtra, Gujarat, Karnataka, Andhra Pradesh and Tamil Nadu have been collecting such tax for development for a long time," he said in his budget speech.