Jammu and Kashmir Fiscal Responsibility and Budget Management Act, 2006
No: 12 Dated: Aug, 14 2006
THE JAMMU AND KASHMIR FISCAL RESPONSIBILITY AND BUDGET MANAGEMENT ACT, 2006
(Act No. XII of 2006)
An Act to provide for the responsibility of the Government to ensure prudence in fiscal management and fiscal stability by progressive strengthening of revenue surplus, reduction in fiscal deficit, prudent debt management consistent with fiscal sustainability, greater transparency in fiscal operations of the Government and conduct of fiscal policy in a medium term framework and for matters connected therewith or incidental thereto.
Be it enacted by the Jammu and Kashmir State Legislature in the year Fifty-seventh Year of the Republic of India as follows: -
1. Short title and commencement. - (1) This Act may be called the Jammu and Kashmir Fiscal Responsibility and Budget Management Act, 2006.
(2) It shall come into force on such date as the Government may, by notification in the Government Gazette, appoint in this behalf.
2. Definitions. - In this Act, unless the context otherwise requires,-
(a) "Act" means the Jammu and Kashmir Fiscal Responsibility and Budget Management Act, 2006;
(b) "budget" means the "Annual Financial Statement" laid before the State Legislature under section 79 of the Constitution of Jammu and Kashmir;
(c) "current year" means the financial year preceding the ensuing year;
(d) "ensuing year" means the financial year for which the budget is presented; ,
(e) "financial year" means the year beginning on the 1st day of April of a year and ending on 31st March of the year next following;
(f) "fiscal deficit" is the excess of aggregate disbursements (net of debt repayments) over revenue receipts, recovery of loans and non-debt capital receipts;
(g) "fiscal indicators" are such indicators as may be prescribed for evaluation of the fiscal position of the Government;
(h) "fiscal targets" are the numerical ceilings and proportions to total revenue receipts (TRR) or GSDP for the fiscal indicators;
(i) "GSDP" means Gross State Domestic Product at current market prices;
(j) "Government" means the Government of Jammu and Kashmir;
(k) "prescribed" means prescribed by the rules made under this Act;
(l) "previous year" means the year preceding the current year;
(m) "revenue deficit" is the excess of the revenue expenditure over total revenue receipts (TRP);
Explanation :- "Total revenue Receipts" (TRR) includes State"s own receipts (both tax and non-tax) and current transfers from the Centre (comprising grants and State"s share of Central taxes).
(n) "revenue surplus" is the excess of the total revenue receipts over revenue expenditure;
(o) "total liabilities" means the liabilities under the Consolidated Fund of the State and the Public Account of the State and includes borrowings by the public sector undertakings an the special purpose vehicles and other equivalent instruments including guarantees where the principal and/ or interest are to be serviced out of the budget.
3. Fiscal Management Objectives. - The Government shall-
(a) take appropriate measures to strengthen the revenue surplus and thereafter build up adequate revenue surplus at a sustainable level, and utilize such surplus for discharging the liabilities in excess of the assets or for funding capital expenditure;
(b) pursue policies to raise non-tax revenue with due regard to cost recovery and equity;
(c) lay down norms for prioritization of capital expenditure; and
(d) expenditure policies that would provide impetus for economic growth, poverty reduction and improvement in human welfare/standard of life.