The Karnataka Budget, essentially a vote on account for expenditure to be incurred during the first four months of the coming financial year, was adopted by the Legislative Assembly amid a walkout by the Opposition parties comprising the Congress and the Janata Dal (S).
Marathon reply
In his marathon reply to the discussions on the budget, Chief Minister D.V.Sadananda Gowda, who is also the Finance Minister, agreed to reduce the value-added tax on beedis to the earlier level since it involved the future of nearly five lakh workers.
With reference to the demand for a further reduction in sales tax on diesel, it was said that the Government had made a beginning by reducing sales tax by 1.25 percentage points (50 paise per litre).
Tyre-making unit
The Government will also be establishing an automobile tyre manufacturing factory at Sulia in Dakshina Kannada to serve the interests of rubber growers in the region, apart from establishing a Sarvagna Development Authority.
All other demands and suggestions made by the Opposition were turned down.
The passage of the budget is a victory for Mr. Gowda who, owing to the intense political activity prior to the commencement of the budget session, was not sure whether he would be presenting his maiden budget.
The Assembly, by voice vote, adopted the Karnataka Appropriation (Vote on Account ) Bill, 2012, the Karnataka Stamp (Amendment) Bill, 2012, the Karnataka Taxation Laws (Amendment ) Bill, 2012 and the Karnataka Motor Vehicles Taxation Laws (Amendment) Bill, 2012.
Financial position
Mr. Gowda said the financial position of the State was “very good” and much better than the neighbouring States with even the Reserve Bank of India appreciating the financial status of the State based on the adherence to fiscal norms and the provisions of the Fiscal Responsibility and Budget Management Act.
The State government had refrained from overdraft or even a ways and means advance, and public borrowings were well within the prescribed limits. It is also the first time that the State has a budget of more than Rs. 1 lakh crore.
