Thiruvananthapuram: Presenting his fifth and the last full-fledged budget of the present LDF government Friday, Kerala Finance Minister KN Balagopal ignored pandering to expected populist sentiments or enhancing welfare measures and, instead, focused on building infrastructure.

Though nose-deep in debts, the FM did not increase taxes on major goods in the 2025-2026 budget presented to the Assembly. The budget, which comes ahead of elections to local bodies later this year followed by those to the State Assembly,  kept away from any welfare measures.

On the taxation front, EVs costing above ₹15 lakh will attract a levy of eight per cent of the vehicle cost. For ₹20 lakhs and above, it will be 10 per cent. Electric cars with battery renting facilities will be taxed at 10 per cent irrespective of the cost. These measures are expected to bring in additional revenue of ₹30 crore, the Finance Minister told the State Assembly.

It was also proposed to increase land taxes steeply to bring in additional revenue.

The budget proposed a cumulative deficit of ₹1269.46 crore (against an opening balance of ₹234.35 crore).

The major infrastructure projects that would get funding include the Vizhinjam-Kollam-Punalur development growth triangle project has been announced. Vizhinjam Port will be connected to production units, assembly units, and railway lines.

The Finance Minister announced that while preliminary work for the Thiruvananthapuram metro rail will begin in 2025, a new IT park will be established in Kollam, and a centre for Artificial Intelligence (AI) will be set up in Thiruvananthapuram.

The Hydrogen Valley project will begin this year with an allocation of Rs 5 crore, while Rs 10 crore will be allocated for bio-ethanol research and production.

The FM also announced a Rs 750 crore allocation for the rehabilitation of Wayanad landslide disaster victims. He also allocated Rs 10,431.73 crore for the health sector in 2025-26. The government also announced Rs 2,915.49 crore for the medical and public health sector. This is an increase of Rs 97.96 crore from the previous year.

The Minister also announced Kerala’s plan to become a wellness and health tourism hub and allocated Rs 50 crore to this effect.

He said Kerala has tided over the most difficult phase of fiscal strain, and its economy is poised for a 'take-off' in the coming years, an optimism that was not shared by many. Opposition parties called the budget a ‘farewell budget’ that would push the state to the brink of a no-getting-back disaster.