Indicating that the previous BJP government did not make enough efforts to get Karnataka its fair quantum of taxes from the Centre, Chief Minister Siddaramaiah on Thursday said the State would make a strong argument before the 16th Finance Commission to enhance the State’s share in taxes.
“The 16th Finance Commission has sought terms of reference from States. It is being prepared and we will file a strong argument. They will also visit the State and seek our opinion. We will do our best to protect the interest of the State,” the Chief Minister told the Legislative Council. “The commission will be told that we are being punished for delivering better fiscal performance. Uttar Pradesh and Bihar, where fiscal performance is not good, get more share than us from the Centre.”
Reduced tax devolution
Responding to a question from Janata Dal (Secular) member K.A. Thippeswamy, he said Karnataka, which had received 4.71% in share from the 14th Finance Commission, received 3.65% from the 15th Finance Commission. Providing figures of reduced tax devolution from the Centre between 2020-2021 and 2022-2023, he said that every financial year, the State’s share had reduced from what the 14th Finance Commission had recommended to what was given as per the 15th Finance Commission. “If Karnataka received ₹33,094 crore in 2018-2019, it received ₹34,952 crore in 2022-2023. If inflation is calculated, the overall allocation to the State has drastically reduced,” he said.
He accused the Centre of increasing cess and surcharges, which are not shared with the States, to deny the States their due share. “While the 15th Finance Commission provided a special grant of ₹5,495 crore to Karnataka in its interim report, Union Finance Minister Nirmala Sitharaman, who is elected from Karnataka, objected to it.” In his written reply to the member, the Chief Minister said that the State would exert pressure on the Centre to release the special grant. Earlier, despite communication to release the grants, the Centre had not done so, the reply stated.
‘Our entitlement’
Mr. Siddaramaiah said, “In the interest of the State, we should all fight. If I ask if it was not a failure on the part of the previous government in not getting the special grant, you (BJP members) will get angry. Getting the special grant recommended by the commission is our right and we are eligible and entitled for it.”
When some BJP members took objection to the Chief Minister naming Ms. Sitharaman in the Council, he asked, “Is it not a fact that the 15th Finance Commission in its interim report recommended special grants of ₹5,495 crore? Is it not a fact that the Union Minister did not approve it, citing that such requests could come from other States too?”
