Kerala Finance Minister KN Balagopal announced a cess on petrol, diesel and liquor in the second full budget of the Left Democratic Front (LDF) government on Thursday.
A social security cess of Rs 2 per litre will be slapped on petrol and diesel. In his budget speech, Balagopal said this is expected to bring in additional revenue of Rs 750 crore to a Social Security Seed Fund.
A cess of Rs 20 will be levied on every bottle of Indian-made foreign liquor (IMFL) costing Rs 500-999 and a cess of Rs 40 will be levied on IMFL bottles costing Rs 1,000 and above.
An additional revenue of Rs 400 crore is expected through the Social Security Cess on IMFL.
The decision to impose the cess on fuels and alcohol comes as the state is facing a financial crunch. The state finance minister said although the state had financial constraints this fiscal year, it was not in debt.
“The state is in a financial position to take more loans. The central government continues its conservative stance. Kerala should be able to take more loans for development projects. Kerala has come so far by overcoming the crisis,” Balagopal pointed out in his budget speech.