Karnataka’s total receipts is estimated to touch ₹1,82,119 crore by the end of 2017-18, a 14.5 per cent higher than the budget estimates envisaged at ₹1,44,892 crore during 2016-17.

Siddaramaiah said in his budget speech that the Gross State Domestic Product (GSDP) in 2016-17 grew at the rate of 6.9 per cent as against the rate of 7.3 per cent during 2015-16.

Agriculture sector is estimated to grow by 1.5 per cent. The cause for decline in overall growth rate is attributable to decline in growth rate of industry and service sectors. The industry sector is expected to grow at 2.2 per cent compared to 4.9 per cent during previous year while the service sector is expected to register a growth of 8.5 per cent during the current year as compared to 10.4 per cent the previous year.

Demonetisation The demonetisation of ₹500 and ₹1,000 currency notes had a major impact on the performance of states tax collection during November and December. Property registrations or documents registered decreased by 25 per cent resulting in revenue shortfall of ₹1,350 crore.

“The goal posts were changed mid-way and the rules were repeatedly modified. While the need for demonetisation itself is debatable, I think that the Central Government and the Reserve Bank of India could have at least foreseen the exigencies and could have put in practical and robust systems in place to insulate the common man from these hardships,” said Siddaramaiah.

States own taxes Siddaramaiah said the States Own Tax Revenue for 2017-18 is estimated to be ₹89,957 crore which is an increase of 9.42 per cent over the revised estimate of 2016-17.

Commercial taxes: The budget estimates for the current year was fixed at ₹51,338 crore. Despite adverse impact of demonetisation on the economy and tax collections in the current year, we are making all efforts to mobilise necessary resources to meet our expenditure requirements and expect to reach the target for the current year. Keeping in view the introduction of GST, the Budget Estimate for Commercial Taxes is pegged at ₹55000 crore.

Excise taxes: Siddaramaiah said, “We had fixed a revenue target of ₹16,510 crore for the excise department for the year 2016-17. We expect to achieve this target. Now with effective enforcement and regulatory measures, the department would be achieving the target of ₹18,050 crore fixed for the financial year 2017-18.”

Stamps and registration: For the year 2016-17, Revenue target of ₹9,100 crore was fixed and we had expected to achieve the same. However, the decision of the Centre to demonetise large currency notes had a major adverse impact on the performance and from November 2016 onwards the number of documents registered decreased by 25 per cent. As a result, we expect shortfall of almost ₹1,350 crore and expect to achieve ₹7,750 crores by March-end.

Transport: The revenue target for 2016-17 was ₹5,160 crore. Due to increase in the registration of vehicles we may exceed the target by achieving ₹5,450 crore, an excess of ₹290 crore. The revenue collection target for 2017-18 is fixed at ₹6,006 crore.

Plan Performance The State’s Plan size for 2016-17 was fixed at ₹85,375 crore. This included support of ₹75,665 crore from the state government’s resources and ₹9,710 crore as resource of the Public Sector Enterprises.

As against this, as per the revised estimates, the plan size for the year 2016-17 is expected to be ₹85,933 crore.

“We are confident of achieving this higher target set in revised estimates,” Siddaramaiah said.

The distinction between Plan and Non-Plan expenditure in the budgetary system was brought in when the plan model of economic growth was adopted in the country, he said.

“The Centre has done away with Plan, Non-plan classification from 2017-18 budget. In line with the national initiative, the state government has decided to remove the distinction between plan and non-plan from fiscal 2017-18,” Siddaramaiah added.

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Published on March 15, 2017