Karnataka’s tax distribution has declined as the share of cesses and surcharges in total tax revenue increased from 8.1% in 2010-11 to 14% in 2024-25, Revenue Minister Krishna Bire Gowda said in the pre-Budget 2025-26 presentation. Union Finance Minister Nirmala Sitharaman.
On behalf of Karnataka and Chief Minister Siddaramaiah, he asked for their (taxes and surcharges) to be included in the bifurcated pool for equal revenue sharing. He also recommended an amendment to the GST Act to incorporate cess into SGST, empowering states to effectively reduce revenue deficit (post-GST).
Mr. Gowda informed the Finance Minister that the state was affected due to the delay in the distribution of grants of the 15th Finance Commission. He demanded immediate release of state-specific grants of ₹6,000 crore, special grants of ₹5,495 crore and cumulative shortfall of ₹3,300 crore for ULBs, PRIs, health grants, and SDRF.
On social security pension, Mr. Gowda said, the Centre’s contribution covered only 14.14 lakh beneficiaries out of 68.66 lakh supported by Karnataka. For instance, in FY 2023-24, the state government spent ₹ 10,554 crore on social security pension, while the Center contributed only ₹ 471 crore (4% of the total expenditure), he said.
“Karnataka calls for extended coverage and long overdue revision of central contribution,” the revenue minister said.
He further informed the Finance Minister that Anganwadi workers and helpers as well as ASHA workers in the state were getting less compensation. The state currently pays ₹7,300 to anganwadi workers and ₹5,000 to ASHA workers, while the Center provided only ₹2,300 and ₹2,000 respectively under NHM, he explained.
Mr. Gowda informed Ms. Sitharaman that Ayushman India has excluded many families in the state, limiting coverage to 69 lakh as per SECC data.
“Karnataka recommends aligning it with the 1.14 crore families covered under the National Food Security Act for equal health coverage,” he said.
He demanded an increase from ₹ 1.5 lakh to ₹ 5 lakh per beneficiary under PMAY (Urban) and central share under PMAY (Rural) from ₹ 72,000 to ₹ 3 lakh per beneficiary.
On railway and road networks, Mr. Gowda said, Karnataka has requested central assistance for additional railway lines, expedited projects, and 50% land acquisition and 100% construction cost. “The state also asks for approval of road infrastructure proposals including new ring roads and upgradation of national highways,” he said.
“Karnataka wants to propose a comprehensive plan for urban infrastructure for housing, transport, and sanitation. “Cities like Bengaluru, Mysuru and Hubballi need substantial upgradation,” Mr. Gowda told the finance minister.
Rivers and irrigation projects
Under the Upper Bhadra project to irrigate 2.25 lakh hectares and augment reservoirs at a cost of Rs 16,125.48 crore, the state has sought recognition as a national project and release of Rs 5,300 crore announced in the 2022-23 Union Budget.
Meanwhile, under the Upper Krishna Project Phase-III, designed to irrigate 5.94 lakh hectares at a cost of Rs 51,148.94 crore, Karnataka requested the DPR to be evaluated and recognized as a national project.
The state has sought evaluation of the DPR and necessary approvals in connection with the Makedatu project, which aims to provide drinking water to Bengaluru and generate 400 MW of electricity, he said.
According to the minister, in connection with the Kalasa and Bandura Nala diversion projects, aimed at improving water supply at a combined cost of ₹ 1,760 crore, Karnataka was seeking necessary approvals.
Regarding the special grant to the Kalyan Karnataka region, the state has allocated ₹ 5,000 crore annually for the region, however, more central support is expected to address disparities in education, healthcare, and infrastructure, Mr. Gowda added.
He also sought a state-specific grant of ₹ 10,000 crore over five years for sustainable development and disaster resilience in the ecologically sensitive Western Ghats.
published – December 21, 2024 at 12:07 pm IST