Ministers and legislators of the ruling Congress in Karnataka have decided to stage a protest at Jantar Mantar in New Delhi on February 7 under the leadership of Chief Minister Siddaramaiah against the alleged stepmotherly treatment by the BJP government at the Centre in devolution of taxes, non-release of drought relief, and denial of clearances for irrigation projects in the State.
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Announcing this at a press conference on Monday, the Chief Minister said that Karnataka had incurred a loss of ₹1.87 lakh crore during the 15th Finance Commission period owing to reduction in devolution of taxes, special grants, and non-distribution of funds collected by the Centre under cess on petrol and diesel, and surcharges.
“A huge injustice was meted out to Karnataka in the 15th Finance Commission (2020-21 to 2025-26) period compared to the 14th Commission (2014-15 to 2019-20). Our protest is not against the BJP, and it is not political. Our protest is to draw the attention of the Centre and the country,” said Mr. Siddaramaiah, who also holds the finance portfolio.
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For the first time, the Congress government in Karnataka will stage a protest in Delhi against the Narendra Modi-led government at the Centre.
The amount allotted to Karnataka from the total collection of taxes, including grants, reduced from 4.71% to 3.64% from the 14th Finance Commission to the 15th Finance Commission. As a result, the State lost ₹73,593 crore, he said.
Karnataka ranks second in collection of taxes ranking next to Maharashtra. The State contributes ₹4.3 lakh crore per year from all types of taxes, but, in turn, the State has been receiving only 12%-13% of its share from the Centre, Mr. Siddaramaiah said.
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The Centre’s Budget size doubled from ₹24.42 lakh crore in 2018-19 to ₹45.46 lakh crore in 2023-24, but the State’s share declined from ₹51,157 crore to ₹50,257 crore, he said. The State’s share in the Centre’s devolution of taxes declined from 2.2% in 2017-18 to 1.23% in 2024-25, he said.
The State has been contributing ₹2.4 lakh crore through Income Tax and Corporate Tax, and ₹1.36 lakh crore in the form of GST to the Central pool. Despite assurance of paying compensation for the loss incurred due to implementation of GST, the Centre stopped providing compensation in June 2022, Mr. Siddaramaiah said.
Union Finance Minister Nirmala Sitharaman, who represents Karnataka in Rajya Sabha, rejected the interim report of the 15th Finance Commission that recommended a special grant of ₹5,459 crore to Karnataka for the loss incurred in the share of devolution of taxes. She has not released ₹6,000 crore promised for development of the peripheral ring road and development of lakes in Bengaluru. “In total, the State had not received ₹11,495 crore from the Centre,” he alleged.
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The Centre envisaged ₹5,300 crore in the 2023 Union Budget for the Upper Bhadra Project. But not a single rupee has come to Karnataka, he said.
The Centre denied environmental clearance for the Mahadayi drinking water project in north Karnataka, and did not grant permission to start work on the Mekedatu project, which was envisaged for catering to the drinking water needs of Bengaluru and surrounding villages in the Cauvery basin. The Centre has not issued a gazette notification on Upper Krishna Project for utilisation of 130 tmcft of water awarded to Karnataka by the Krishna river Water Tribunal, he said.
Despite severe drought in 223 of the total 236 taluks in Karnataka, the Centre has not released funds to the State, he alleged.