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What is your pay’n threshold?

If you thought that the run of hikes was over after the power, water subsidy rollbacks and the increase in DTC bus and Delhi Metro fares, you are in for a shocker. The Delhi government is now mulling over some more hikes to augment its income, reports Anuradha Mukherjee.

delhi Updated: Dec 05, 2009 00:12 IST
Anuradha Mukherjee

If you thought that the run of hikes was over after the power, water subsidy rollbacks and the increase in DTC bus and Delhi Metro fares, you are in for a shocker. The Delhi government is now mulling over some more hikes to augment its income.

This time it's an increase in the VAT rates of certain goods that currently are covered under the lowest 4 per cent slab.

TV no freebie

Television viewing on your Direct to Home (DTH) connection is likely to cease to be free of charge. The government is reportedly planning to levy a charge of Rs 20 per month per DTH connection.

The government cites deficits in income caused by expenses due to implementation of the Sixth Pay Commission recommendations and Commonwealth Games projects.

Delhi was expected to spend Rs 9,000 crore on the Games 2010, of which it has received Rs 1,750 crore so far.

Delhi cabinet was supposed to take a call on the proposal on Friday, but the decision was postponed to Saturday.

Official speak

The Delhi government said that these hikes were measures meant to help bridge the gap between the state's expenditure and collections.

“The Delhi government was giving Delhiites a lot of concessions in the form of subsidies - like a Rs 163 crore subsidy on cooking gas, another Rs 200 crore subsidy on power,” said Delhi Finance Minister A.K. Walia. “The government was paying for the losses of Delhi Jal Board and Delhi Transport Corporation so that the burden was not passed along to residents.”

In 2008-09, DJB and DTC were running in losses of over Rs 450 crore and Rs 564 crore.

In 2009-10, DTC and DJB were expected to incur losses to the tune of over Rs 665 crore and Rs 540 crore in 2009-10.

While the Delhi government's annual budget hovers about Rs 23,000 crore, its collections from both tax and non-tax sources (money from Centre, allocations for projects, money raised from small savings loan etc) do not add up to more than Rs 21,000 crore.

In 2008-09, while the annual budget was about Rs 20,000 crore, the government's tax collections was Rs 12,180 crore.

“The gap was made up with Rs 2,800 crore from the small savings loans allocation from the Centre. We have already spent Rs 10,500 crore under the small savings loans head. There is a total outstanding amount of Rs 26,000 crore from 1993 onwards when Delhi government was formed that we owe to the Centre under this head,” said a finance department official, who refused to be identified, as he was not authorised to speak to the media.