BJP MP claimed Congress in run-up to the assembly elections, without bothering about financial implications have announced free guarantees.
Tejasvi Surya adressing the press. (Screengrab)
In a counter to the protest by the Karnataka Congress at the Jantar Mantar in Delhi, the BJP Yuva Morcha’s national president and Bengaluru South MP Tejasvi Surya claimed on Wednesday, 7 February, that the party announced free guarantees in the run-up to last year’s Assembly elections, without bothering about the financial implications.
The BJP MP told reporters, “Where do they bring money to fulfil their guarantee? They did not provide any justification or answers before the polls.”
He added: “After winning the elections, the Congress government realised that these guarantees could not be implemented immediately.”
Citing the Anna Bhagya scheme, Tejasvi said, “For example, Chief Minister Siddaramaiah had announced that the government would give 10 kg of free rice. When it realised that it would not be possible to provide 10 kg of rice, it immediately argued that the Union government stopped the supply of rice and that injustice happened to Karnataka.”
Tejasvi Surya also criticised Deputy Chief Minister DK Shivakumar, recalling his statement that there were no funds for developmental works.
The MP said the chief minister’s financial advisor Basavaraj Rayareddy claimed that funds worth about ₹58,000 crore were needed to implement the guarantees.
Hitting out at the party, he said: “The Congress issued irresponsible statements and assurances during the elections. Realising it would be difficult to fulfil the guarantees, the party started blaming the Union government.”
The South Bengaluru MP added: “It is in this context that we have to view the drama of the Congress at Jantar Mantar in Delhi.”
Tejasvi said: “The first allegation from the chief minister and the state government is that the injustice has been meted out to Karnataka and our state’s share [in Central funds] has been reduced.”
Speaking about tax devolution, the MP said, “From 2004 to 2014, Karnataka received ₹81,795 crore in tax devolution. From 2014 to 2024, Karnataka got ₹2.85 lakh crore. The money given to Karnataka in tax devolution increased over 250 percent.”
He added: “As for grant-in-aid, Karnataka got ₹60,779 crore from 2004 to 2014. In the last decade, under the leadership of PM Modi, the state received ₹2,08,830 crore. The state has witnessed a 243 percent increase in grant-in-aid.”
Tejasvi continued: “Despite these facts, the chief minister and the Congress government continue to make false allegations. How much has Karnataka received in the last 10 years? Of the total grants received in the last 20 years from the Centre to Karnataka, 75 percent have come in the Modi government.”
The MP, however, made no mention of how much Karnataka had increasingly contributed to central taxes over the years.
Needing about Rs 58,000 crore to fulfil its guarantees, CM @Siddaramaiah Govt has no funds left for development.
Having failed Karnataka on governance, Congress is now desperately distracting the people with a false narrative of low tax devolution to state.#CongressLiesBusted pic.twitter.com/LSIFY6NfIC
— Tejasvi Surya (@Tejasvi_Surya) February 7, 2024
Replying to the chief minister’s remarks about the disparity in funds from the Union government, the BJP MP said, “The second argument of the chief minister is that after Congress came to power in Karnataka, the Centre created disparity in terms of fund allocation.”
“Whichever be the government, either Centre or state, tax devolution cannot be done based on whimsy or as per their wishes. It has its own rules and auditing system. Tax devolution should happen as per the norms.”
The MP noted, “Tax devolution is fixed as per the rules of the Finance Commission, which is a Constitutional and autonomous institution. The Centre cannot fix tax devolution as per its whims and fancies and favour some states.”
The Bengaluru South MP also said: “With regard to the Finance Commission, the chief minister made three allegations. The first was that Karnataka’s share had been reduced by 1 percent. That has been reduced for all the states.”
He explained: “The reason is that after Article 370 was abrogated, Jammu and Kashmir were announced as Union Territories. The funds for these two regions were to come from the Centre. Hence, all the states witnessed a reduction by 1 percent.”
Tejasvi continued: “The argument of the chief minister that injustice happened only with Karnataka has proven to be false, considering the documents of the Finance Commission.”
He noted: “The second [allegation] was that injustice happened to Karnataka at the behest of the Union government. The chief minister knows very well that the Finance Commission is an autonomous body constituted under Article 280 of the Constitution. It considers only the opinions of the states and the Centre.”
The MP added: “Officials attached to the Finance Commission were in Karnataka from 23 to 26 June, 2019, to collect opinions. Who was in power? The Congress and the JD(S) were in power. The state government representatives including the then deputy chief minister Dr G Parameshwara, who is currently the home minister, and several Cabinet ministers, including Satish Jarkiholi and Krishna Byre Gowda, were present.”
He said: “The Congress’ current prominent Cabinet ministers failed to effectively present the argument in the interest of Karnataka before the commission in 2019. Today, fake allegations are being levelled against the Modi government.”
Retorting to another claim by Siddaramaiah, Tejasvi Surya said, “The third allegation was that the Finance Commission recommended that the state government be provided ₹5,400 crore special grants, but the Centre did not implement this.”
He noted: “The Finance Commission’s final report is constitutionally binding on the government. The Centre cannot escape the recommendations of the Finance Commission. The chief minister knows the reality but he is lying on this as well.”
The BJP leader alleged: “There is no mention of recommendations of providing the special grants to the state in the final report of the Finance Commission. The chief minister is blatantly lying before the people of the state.”
He added: “There is a 500-page commission report. We searched every single line. No special grant was recommended for any state. The argument of the chief minister is a white lie.”
He continued, “I challenge the chief minister: If there is a mention of a recommendation of the special grant to Karnataka in the final report, and if the Centre did not abide by it, he may approach the Supreme Court considering it a violation of Article 281 of the Constitution.”
The interim report of the 15th finance commission had recommended special grants of ₹5,400 crore to Karnataka. The final recommendation of the 15th Finance commission earmarked State specific funds of ₹6000 crores to Karnataka.
“We are inclined to recommend State-specific grants to meet some special obligations of regional and national concern,” the 15th Finance commission said in its report setting aside ₹49,559 crores as State specific grants of which ₹6000 crore is allocated to Karnataka. CM Siddaramaiah alleges that the Union government hasn’t released the State specific grant either.
Tejasvi Surya continued: “Another allegation is that since the implementation of GST, Karnataka is incurring losses every year. We used to get more grants before the implementation of the GST.”
He noted: “After GST was implemented, Karnataka got ₹31,900 crore in 2017-18, ₹55,356 crore in 2018-19, ₹61,900 crore in 2019-20, ₹73,000 crore in 2020-21, and ₹82,000 crore in 2021-22. From 2017 to 2023, the GST compensation and GST revenue collection increased every year. These stats have also been reflected in the budget as well.”
Tejasvi also noted that from ₹31,900 crore in 2017-18, the amount increased to ₹82,000 crore in 2020-21.
“GST collection is increasing every year, and the stats clearly display it. Yet, the chief minister continues to lie on the matter. How good is that?” he alleged.
Karnataka Finance Ministry’s estimation of protected GST revenue versus actual GST collection. (SouthFirst)
The GST collections in Karnataka, however, are far lower than the protected growth predicted by the Union government during the implementation of GST regime.
Tejasvi Surya said, “Another allegation of the Chief Minister is that Karnataka provides the highest amount of tax to the Centre after Maharashtra and Delhi, but the share it gets back is very low. This argument will not tide well for the chief minister, who presented the budget a record 13 times.”
“The ‘Our tax, Our right’ argument is being made without understanding the wishes of the country’s democracy,” said Tejasvi Surya.
“In a society, as in a family, some states will be ahead and some will be behind because of socio-economic reasons. It is the responsibility of the Centre to take all the states forward together. It is the responsibility of the states to take all the districts together,” he noted.
He further said: “Aren’t the software produced in Karnataka being used by companies in Maharashtra and Karnataka, Delhi and Mumbai? The items produced in Mysuru, Hubballi, and Belagavi — aren’t they being marketed in different parts of the country?”
Tejasvi Surya then reasoned: “The ‘Our tax, Our right’ slogan: Isn’t it against the federal system? Bengaluru alone makes up for around 60 percent of the GDP of Karnataka. If we argue that Bengaluru’s revenue should be utilised only for the state capital, where should the interest of Karnataka go?”
He added: “The prime minister is making efforts to develop the backward districts under the Aspirational Districts programme. If you continue to make such arguments, where should the concept of the country and state go?”
He continued: “If you extend this argument in Bengaluru, the amount of tax paid in the Mahadevapura region is not paid in other regions in the state capital. Is it possible to run such a system and government?”
He also highlighted the railway and highway projects sanctioned to Karnataka in the last 10 years.
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