There’s Confusion Surrounding The Collection
Urmi A Goswami NEW DELHI
WILL finance minister P Chidambaram tell the nation how much money has been actually collected as education cess, because his ministry can’t come up with one figure. The total amount of cess collected seems to vary, depending on where the information is being given. The variation in the amount collected ranges from about Rs 200 crore to Rs 500 crore.
In November 2007, minister for state for human resource development MAA Fatmi informed Parliament on the basis of information provided by the department of revenue that Rs 4,159.39 crore, Rs 7,117.07 crore and Rs 9,037.23 crore had been collected as education cess for 2004-05, 2005-06 and 2006-07, respectively. These figures are substantially different from the ones provided by the government’s official accountant, the Controller General of Accounts.
The 2% education cess, according to figures from the Controller General of Accounts, is Rs 5,557.58 crore in 2004-05, Rs 7,322.82 crore in 2005-06, and Rs 9,466.5 crore in 2006-07. To make matters a little more ambiguous, figures available with the HRD ministry show cess amount to be Rs 4,318.51 crore in 2004-05, and Rs 7,637.75 crore in 2005-06. For the year 2006-07, the HRD ministry only had figures till February — Rs 6,833 crore.
The 2% education cess was introduced in Budget 2004-05 to ensure that more money flowed into the basic education segment as promised in the UPA government’s common minimum programme. The education cess is levied on all central taxes such as corporate tax, income tax, service tax, custom duty and excise. Since no separate fund had been created for the cess, that year the finance ministry debited Rs 4,173 crore from the year’s expenditure on SSA and mid-day meal, which was Rs 6260.50 crore.
In November 2005, the Prarambhik Shiksha Kosh (PSK) was created as a non-lapsable fund in the public accounts. In real terms, it means the total quantum of money collected as education cess would have to be parked in a designated fund created in the public accounts. And the proceeds of the 2% education cannot be used for any purpose other than funding Sarva Shiksha Abhiyan and the mid-day meal programmes. So, even if the HRD ministry did not use the entire amount of cess collected in the year, the government wouldn’t be able to divert the money for other purposes. The balance of unused funds would have to show up in the Prarambhik Shiksha Kosh.
urmi.goswami@timesgroup.com