CONTROLLING EXPENDITURE IS A FORMIDABLE TASK FOR THE STATE OF TAMIL NADU A COMPARATIVE STUDY WITH OTHER MAJOR STATES IN INDIA

Abstract

This paper aims at analysing the various aspects of Budget of the State of Tamil Nadu such as State's Own Tax Revenue, Central Transfer, Grants-in-aid and Fiscal Deficit / Surplus of the State of Tamil Nadu with other major States in India. Of late, the role, functions and expenditure of the State Governments have been mounting in a growing economy. As the State Governments are much closer to the people than the Union Government, the accountability of providing many services is assigned with the State Governments. The States provide basic amenities like provision of roads, street lights, drainage facility, electricity, public transport facility, drinking water facility, maintain law and order, build up economic and social infrastructure, guarantee education and health for all and ensure social safety net for the downtrodden. (Budget for the year 2018-19) In addition, the States have to meet the ever increasing administrative costs, such as payment of salaries and pension, expenses towards implementation of Pay Commissions' recommendations, periodic hike in Dearness Allowance, Increments, creation of new posts, filling up of vacancies, expenses towards rescue, relief and rehabilitation in case of unforeseen circumstances like tsunami, flood, drought, etc. (Budget for the year 2018-19) The expenditure for providing all these services has to be met by the State Government from their own receipts. At the same time, it is also the responsibility of the State Governments to control the Revenue Deficit to the minimum, maintaining fiscal deficit within three per cent of Gross State Domestic Product.