Let's take a deep dive as to why the Siddaramaiah-led government is protesting:
The Upper Bhadra Scheme: The Union Government had announced an allocation of ₹5,300 crores for the project in last year's budget. CM Siddaramaiah claimed that the Centre has not released “a single rupee” so far.
Drought Relief: Out of the total 236 taluks of Karnataka, 223 taluks are said to be drought ridden, with 123 of them severely affected. In a social media post, the CM said his government has requested a compensation of ₹17,901 crore from the Centre, even as the actual loss incurred by the state due to crop damage stands at ₹35,000 crore. “They have not released anything for drought relief either,” He wrote in the post.
Reduction in Tax Share: The Congress stalwart also alleged that the tax share allocated to Karnataka reduced from 4.71% under the 14th Finance Commission (2015-2020), to 3.64% by the 15th Finance Commission (2020-2025). “This 1.07% decrease resulted in an estimated loss of ₹62,098 crore for Karnataka over five years. To compensate, the 15th Finance Commission recommended a special grant of ₹5,495 crore for Karnataka in the interim budget, which Finance Minister Nirmala Sitharaman subsequently declined,” Siddaramaiah said. Adding the proposals for lake and water body development and peripheral ring road projects ( ₹3,000 crore each), altogether, Karnataka missed out on a total of ₹73,593 crore, he added.
GST woes: Before GST, our state's tax collection growth was at 15%, the CM noted. He alleged that the Centre discontinued the compensation given to states to make up for potential losses after the implementation of GST. “Karnataka, the second-highest tax collector after Maharashtra, contributes a significant ₹4,30,000 crore in tax revenue. However, the state receives only around ₹12-13 out of every ₹100 in taxes, with the rest held by the Union Government,” He further alleged.
Mahadayi and Mekedatu Projects: The senior Congress leader also said environmental clearance and necessary permissions for the Mahadayi and Mekedatu projects are still pending.
Reduction in Tax Devolution: “As the budget size doubled, it was expected that the state's tax share would also double. However, it has been reduced by more than half. Furthermore, cess and surcharge have been consistently increasing each year, with not a single rupee being returned to the states, even though both cess and surcharge are collected by the states themselves. This consistent decline in the state's share highlights a growing injustice towards Karnataka,” CM Siddaramaiah said.
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