Tax and the city

by karwar


Mahadevapura resident files RTI application to show mismatch between Karnataka’s taxes and Centre’s infra spend

Karnataka collected Rs 67,031 crore as individual income tax and another 1.13 lakh crore as corporate income tax during the last five months, according to data accessed from the office of Chief Commissioner of Income Tax under the Right to Information (RTI). The state, however, has received step-motherly treatment from the Centre, says Pradeep K, a resident of Mahadevapura who filed the RTI application.

The document shows the monthly net collection of corporate tax in the State is roughly about Rs 25,000 crore. It went up to as much as Rs 48,798 crore in December, 2018 while the collection came down to Rs 16,882 crore in May, 2020. A glance at the monthly collection over the last and half years shows that there is no significant fall in the corporate income tax even when the state was in the middle of covid-19 pandemic.

The income tax collection from individuals has however seen a dip. On an average, Karnataka had generated about Rs 25,000 crore to Rs 50,000 crore a month as income tax in 2018-19. Over the last five months, the monthly collection is seeing a huge difference. The state collected Rs 14,610 crore in April this year, but it came down to Rs 9,974 crore in May. The collection went up to Rs 38,822 crore in June while it fell down to Rs 5,431 crore in August this year.

Step motherly treatment

The RTI applicant says the state has received step motherly treatment when it comes to projects such as infrastructure, be it the pending approval for Metro line on the Outer Ring Road to the Kempegowda International Airport and suburban rail project. The techie also said priority has not been given in the timely execution of 1 lakh houses for the urban poor. Even the number of generic drug stores opened in the state are way too less than the other states.

“Karnataka is being treated as a cash-cow. Lack of financial support is making the City unliveable. Even when the Centre makes policies pertaining to finances, whether it’s an annual budget or devolution of funds to states, they are not debated well. Even industry leaders do not express themselves freely as done in other countries,” Pradeep said.

When the Centre had fixed percentage terms of the tax share devolved under the 15th Finance Commission early this year, Karnataka had emerged as the biggest loser. The state’s share had come down by 23%; from 4.713% of the total divisible pool in the 14th commission to 3.646%.

In the 15th Commission, Karnataka received from the Centre just Rs 40 for every Rs 100 generated as tax revenue. This is down from Rs 53 per Rs 100 State got under the 14th Commission. States such as Uttar Pradesh and Bihar received about Rs 290 for every Rs 100 contributed.

Officials in Karnataka said they get an average of Rs 1,500 crore as part of the devolution of funds from the Centre. This is in addition to what the state owes from GST collections.

When asked to comment, former member of Rajya Sabha Rajeev Gowda had this to say: “They are national taxes. The tax collection is a reflection of Karnataka’s extraordinary growth potential. The kind of talent, knowledge and wealth it generates makes Karnataka and Bengaluru a global state / city.

Brand Bengaluru resonates across the world.” He said the government should invest heavily in nurturing this ecosystem so that the state generates a lot more wealth.



Source link

You may also like

Leave a Comment