Telangana chief minister K Chandrasekhar Rao urged the centre to exempt bodies that are set up for the development of urban areas from tax. The request made in the backdrop of a proposal to sell of lands in HMDA jurisdiction to mobilse funds for the developmental activities. The submitted a memorandum to this effect to Arun Jaitley, union finance minister. He brought to the notice of the union finance minister the rejection of state’s request to exempt Hyderabad Metropolitan Development Authority (HMDA) from income tax by the additional commissioner, Income Tax, Hyderabad. Rao was in Delhi yesterday to seek more central assistance to the state projects.
KCR’s argument is that the income generated by the urban authorities is put to use again in providing facilities for public and there was no private purpose or profit motive involved in it. KCR reiterated the request and asked the centre to make a policy decision on this. The chief minister also urged the finance minister to raise the cap imposed by Fiscal Responsibility and Budget Management (FRBM) Act for raising loans..
Referring to 14th Finance Commission recommendation that the states which have revenue surplus could be permitted to access market borrowings up to 3.5 percent of the state GDP by raising ceilings of 3 percent, the chief minister urged Jaitley to increase the FRBM limit for Telangana to 3.5 percent. Jaitley jokingly asked the CM as to why the state needs to borrow when it is a revenue surplus state.
Jaitley told reporters after the meeting that the chief minister made certain suggestions with regard to raising of resources for the state and regulations to be relaxed. “He wants the FRBM’s limit for the state to be raised. He gave supporting documents. Finance ministry’s department of expenditure will look into it,” he said.
