West Bengal budget FY22: stamp duty to be cut by 2%, circle rates by 10%
As part of its Rs 3.08-lakh-crore budget presented in the legislature on July 7, the West Bengal government opted to grant a 2 percent stamp duty rebate for deed registration and lowered circle rates by 10%.
Partha Chatterjee, the state industry minister who had suggested the vote-on-account in the House in February, presented the Budget, saying the government has proposed lowering stamp duty by 2% for deed registration and slashing circular rates 10%. Amit Mitra, the finance minister, is ill.
“We are all aware that our state, as well as the country as a whole, is experiencing economic hardship as a result of the COVID-19 outbreak. As a result, the people’s purchasing power has been reduced. The crisis has severely impacted the real estate sector. In this urgent scenario, the state government proposes to assist the registrant public by lowering the rate of stamp duty for registration of deeds impacting the sale/lease of land/house. sale, and so on. I propose lowering the stamp duty rate for such deeds by 2% from the current rate.” according to the budget paper.
In his budget speech, the minister stated that the state had fully budgeted for debt servicing. He asserted that West Bengal’s debt-to-GDP ratio of 35.54 percent is significantly lower than the national debt-to-GDP ratio. However, according to the financial summary presented at the end of the Budget, the state’s yearly budgeted borrowing increased by over 23% above last year’s actuals to a record Rs 1,15,819 crore.
While Devdutta Basu, a well-known financial analyst, praised the stamp duty cut, which he termed as a blessing in these difficult times, he cautioned that because the “states debt is increasing, debt reduction should be a priority.”
According to the financial statement, spending on budgeted debt servicing and loan repayments increased by around 20% over last year’s actuals for 2021-22, indicating that the state government is attempting to retire older high-cost debt, according to financial analysts.
The government’s income-expenditure assist program increased, from just over Rs 1.8 lakh crore to over Rs 2.13 lakh crore, due to new scheme spending.
New projects and schemes
Mamata Banerjee, the Chief Minister of West Bengal, had called a vote-on-account in the House in February, during which 26 plans and projects were unveiled. The minister indicated that a 4% interest rate will be paid on the student credit card scheme, which was launched on June 30, and that the government will cover the balance as a subsidy. Furthermore, no collateral will be required to participate in the program, and the loan amount will be fully insured and guaranteed by the government.
He stated that the government’s ‘Duare Ration‘ (Ration at assisting the Doorsteps) program, in which food grains are given to households, will be expanded in the coming days. During his speech, the industry minister also suggested allocations for important ministries for the current fiscal year, with health and education receiving a sizable chunk of the pie.
He went on to say that the state government will soon introduce a West Bengal basic income scheme called Lakshmi Bhandar (Lakshmis Gift) to help every household’s female members. Women from SC/ST households would receive Rs 1,000, while those from the general category will receive Rs 500.
The state government also raised spending in several areas. In the aftermath of various targeted programs announced by the state, health, home, and hill affairs, disaster management, education, and women and child development departments witnessed a considerable increase in allocation.
The allocation for the Home and Hill Department in 2021-22 was Rs 11,939 crore, up from Rs 1299 crore the previous year, a nine-fold increase. The allocation for disaster management has increased tenfold to Rs 2,105 crore from Rs 215 crore in 2020-21.
The Bengal government also increased the health budget by nearly 400% to Rs 16368 crore to properly combat the Covid-19 outbreak, compared to the Rs 4608 crore allocation previously. The food and supplies department’s allocation surged by about 50% to Rs 12293 crore.
The Budget was well received by West Bengal’s business chambers and industrialists. According to CII vice-chairman (Bengal) Subhasendu Chatterjee, the financial boost offered to industrial sectors will undoubtedly help in effectively navigating the pandemic problems.
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