Cost of electronic items, building materials go up in Kerala

The Centre had allowed the state government to levy an extra one per cent flood cess which will now be in place for two years. Basic food items are excluded from the list.

Thiruvananthapuram: Starting from Thursday, price of 928 items ranging from electronic items to building materials and others which are included in the categories higher than five per cent GST slab will cost one per cent more in Kerala.

This will go towards the flood cess, which will be used for rebuilding Kerala after last year's flood wreaked havoc in the state. Basic food items are excluded from the list.

The Centre had allowed the state government to levy an extra one per cent flood cess which will now be in place for two years.

After effects of Kerala floods

State Finance Minister Thomas Issac expects that this one per cent is expected to fetch an additional Rs 2,600 crore and will help in rebuilding Kerala. He said this should be collated on a monthly basis.

However, economist Mary George said one reason why the Centre has allowed the state to collect an additional one per cent cess is that it could not provide the desired funds despite repeated requests to tide over the damages. The Centre had provided Rs 2,904 crore for the state.

"There is nothing wrong with this method but there should be strong checks and balances to ensure that this money solely goes for the purpose it is being collected for. Successive governments in Kerala in the past have seen funds being diverted for other needs and that should not happen," said George.

The World Bank itself estimated that Kerala suffered a loss of Rs 31,000 crore.

The floods, which began after heavy rains at the end of May last year and continued till mid-August, claimed 483 lives, and at the height of the deluge over 14.50 lakh, people were displaced taking shelter in over 3,000 relief camps.

Soon after the floods, the Kerala government gave a call to all to contribute to the Chief Minister's Distress Relief Fund and through that, the state was able to raise about Rs 4,016 crore, of which Rs 1,055 crore still remains unused.

Senior Congress legislator and former State Minister Thiruvanchoor Radhakrishnan, however, said that the Pinarayi Vijayan government was functioning in a strange way.

"This is a blow, especially to those lakhs of people who suffered during the floods. They are asked to suffer again as the price of essential items is going to increase. Moreover, everyone wishes to get a statement of accounts on how much money was received and where all was it spent," he said.