Karnataka’s Central share of taxes and grants have reduced, though Union Budget size has increased: Siddaramaiah

This situation, coupled with corruption, is making State reel under loan burden, claims former CM

Leader of the Opposition Siddaramaiah on Tuesday alleged that the “injustice” being meted out by the Centre in allocating the State’s share of taxes as well as grants, coupled with corruption in the State government, had increased Karnataka’s loan burden, causing a strain on its finances.

Participating in a debate in the Assembly on the State Budget, Mr. Siddaramaiah alleged that the total loan burden of the State would touch ₹5.64 lakh crore by the end of the next financial year, resulting in the State ending up paying ₹56,000 crore a year as interest and principal amount towards debt servicing.

Pointing out that Karnataka had got a total Central share of taxes and grant of ₹51,977 crore in 2018-19 when the Union Budget had a size of ₹24,42,293 crore, he said the Central allocation had reduced to ₹50,257 crore now though the Union Budget size had increased to ₹45,03,097 crore. Going by the Union Budget size, Karnataka should have got about ₹1.04 lakh crore as its share of Central taxes and grants, he maintained.

Pointing out that Karnataka was contributing about ₹2.72 lakh crore of Central taxes, including GST and I-T, he said the State had been given a Central share of taxes to the tune of only ₹37,252 crore as against other States which got more tax share though they collected a fraction of Central taxes when compared with Karnataka.

Reeling out statistics, he alleged that Tamil Nadu was given a Central share of taxes of ₹41,000 crore though it collected central taxes of only ₹88,000 crore, Uttar Pradesh got more than ₹1 lakh crore of Central tax share as against its collection of ₹34,070 crore, and Andhra Pradesh got ₹41,000 crore of Central share of taxes though it collected only ₹56,007 crore of Central taxes.

This had resulted in Karnataka’s loan burden going up, he alleged. “While the erstwhile Congress government led by me borrowed ₹1.16 lakh crore in five years from 2013, the BJP dispensation borrowed ₹3.22 lakh crore in the last four years,” he said.