BENGALURU: With uncertainty over the passage of the Goods and Services Tax (GST) Bill persisting and the sharing pattern over devolution of Central revenue between the Union government and the states still undecided, the state government is staring at a resource crunch, which is likely to force a cut in its Plan size.
According to official sources, the drought in the state has only made matters worse along with the cut in the flow of Central funds. “The cut in Plan size could be between 20 and 30 per cent, and a clear picture will emerge next month, after evaluation of the resource mobilisation status at the end of the third quarter,” a senior official in the Finance Department told Express.
Chief Minister Siddaramaiah, who also holds the Finance portfolio, in his budget for 2015-16 , had fixed the annual Plan size at Rs72,597 crore, about 10.67 per cent higher than the previous year.
“If one goes by the leads of the resource mobilisation drive in the four major revenue earning sectors, including Commercial Taxes, Stamps and Registration, and Transport Department, so far, the collection is far from healthy, except from the Excise Department,” the official, said.
Of the state’s total tax revenue of Rs1,01,235 crore, a lion’s share of over Rs46,250 crore was expected from the Commercial Taxes Department, followed by Rs15,200 crore from Excise, Rs8,200 crore (Stamps and Registration) and Rs4,800 crore (Transport).
The state government had also estimated an earning of over Rs5,206 crore from non-tax revenue sources, Rs24,790 crore by way of the share in Central taxes, another Rs9,919 crore through Central grants, apart from borrowings of over Rs22,950 crore, to meet its Plan expenditure.
“With the estimated collection from all the major revenue sources likely to fall short of the target, and the Central share of revenue not forthcoming on expected lines, Karnataka is facing one of the severest financial crises in the recent past,” a high-ranking official in the Finance Department said.
[With the Central share of revenue not on expected lines, Karnataka is facing one of the severest financial crises in the recent pastA high-Ranking official of the Finacen Department