BENGALURU: Chief Minister BS Yediyurappa, who will present the State Budget on Thursday, may have to resort to increasing excise, entertainment and petroleum product taxes to manage the budgetary requirements at a time when both state and central governments are facing an economic slowdown.
The state government may not approach the Centre for more funds as the latter too is facing a severe fund crunch. The size of the budget will be more or less the same as last year’s, sources said.
One of the major reasons for economic slowdown in the state is the dismal performance of the Micro, Small and Medium Enterprises (MSME) sector, which has pending bills with the government.
According to a senior officer in the State Finance Department, mobilizing the funds from the market is well within the state’s borrowable limits. It is done based on requirement and the state may again explore this option in future. “It all depends on the requirement,” the officer added.
According to the latest offer, the government’s stock up to 10 per cent of the notified amount of the sale of each stock will be allotted to eligible individuals and institutions. This is subject to a maximum limit of one per cent of its notified amount for a single bid per stock as per the Scheme for Non-Competitive bidding facility.
Apart from Karnataka, several other state governments, including Andhra Pradesh, Assam, Gujarat, Kerala and Tamil Nadu, too, have offered to sell their securities by way of auction.