Karnataka Chief Minister HD Kumaraswamy on Thursday presented his coalition government’s maiden Budget for fiscal 2018-19.
Karnataka Chief Minister HD Kumaraswamy on Thursday presented his coalition government’s maiden Budget for fiscal 2018-19. While Karnataka Chief Minister HD Kumaraswamy provided loan relief to the farmers in the state, budget imposed a host of tax hikes on petrol, diesel, liquor and electricity. The budget has hiked tax rate on petrol from the existing 30 percent to 32 percent, hiking prices in the state by Rs 1.14 per litre. The tax rate on diesel has been hiked from the present 19 percent to 21 percent increasing its price by Rs 1.12 per litre.
HD Kumaraswamy has reasoned out the hike as a much needed step to increase resource mobilisation towards fulfilling loan waiver promise made to farmers before assembly election as the budget also announced farm loan waiver of Rs 34,000 crore for the farmers in the state. The loans of up to Rs 2 lakh per farmer will be waived, the budget document said. Other than hike in cess on petrol and diesel, tax on liquor was also hiked by 400 basis points (bps). An additional excise duty on Indian Made Foreign Liquor (IMFL) of 4 percent on all 18 slabs, over and above the existing excise duty was imposed, the budget document said.
The tax on consumption of electricity has been increased from existing 6 percent to 9 percent. The captive energy is now proposed to be taxed at double from 10 paise per unit to 20 paise per unit.
Promising to continue the flagship programmes of the previous Congress government, Kumaraswamy told the legislators that the overall size of the budget would be Rs 2,13,734 crore. “I propose to allocate Rs 150 crore for agriculture development based on the Israeli model. We will focus on agriculture as well as the services sector,” he said.
Meanwhile, according to the state agriculture department’s estimates, of the 74 lakh farmers across the state, 25 lakh of them don’t take institutional loans but borrow from private sources, including moneylenders at a high interest rate and get caught into debt trap.
In a related development, opposition BJP leader BS Yeddyurappa sought a White Paper on the state’s finances ahead of the Budget presentation, alleging that loans and bills amounting to Rs 2.38 lakh crore were outstanding.