The CPI(M)-led LDF government in Kerala proposed a slew of new tax proposals, including five per cent tax on certain packed foods and a 'fat tax' of 14.5 per cent for burgers, pizzas and pastas served in branded restaurants.

The move spells bad news for multi-national fast food chains like McDonalds, Pizza etc.

The state, however, expects to earn over Rs 10 crore from the new tax. A similar fat tax is already in place in countries such as Denmark and Hungary.

Stating that the state was passing through a severe financial crisis due to various factors, the budget proposed an 'anti-slowdown package' of Rs 12,000 crore for taking up various development and infrastructure projects like roads, bridges and IT parks.