Talking to reporters at Kottayam today, he said the Centre had cut down the annual tax amount allotted to the state, putting it in a financial difficulty.
"The state government gets a tax-share of Rs 8,100 crore every year from the Centre. They, however, had cut the amount to Rs 7,000 crore last year. The state will be getting that amount this year too. The recent tax increment has been to overcome the shortage of that Rs 1,100 crore," Mani said.
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He said the ban on the Indian-made foreign liquor (IMFL) had nothing to do with the recent tax hike.
The Kerala Congress (M) chief added the Cabinet would discuss the demands to withdraw the rate hike on drinking water by 50 per cent.
Earlier, Mani blamed the expenditure incurred on non-budgetary proposals for the economic difficulties.