Bengaluru, DHNS, BJP members walk out from Assembly during discussion on budget. Chief Minister Siddaramaiah while trying paint a rosy picture of the State’s economy, stood firm on his decision to increase tax rates on several commodities and services, imposed in the budget proposals for 2016-17.

While replying to the discussion on the budget in the Legislative Assembly on Wednesday, Siddaramaiah rejected every demand raised by the Opposition. He even ruled out waiving crop loans availed by farmers stating that the burden on the government would be as huge as Rs 10,000 crore. The interest on farm loans would be waived if farmers repay the principal by September 30 this year. However, total crop loan waiver was not possible as it would be a costly affair, he categorically said.

The BJP?members, at the end of Siddaramaiah’s reply, staged a walkout stating that none of their demands including crop loan waiver for farmers in wake of prevailing drought, roll back of hike in tax rates on petrol and diesel had been met.

Siddaramaiah said the state borrowings, fiscal deficit, debt servicing were well within the limits set by the Karnataka Fiscal Responsibility Act. “The government has set a robust plan size of Rs 85,375 crore for the year 2016-17, higher than most of the neighbouring states. The growth in plan size stood at 13.7% compared to the previous fiscal. The state has done well despite the severe drought and the shortfall in commercial taxes meeting its budgetary target by Rs 800 crore due to fall in prices of petrol and diesel,” he said.

Petrol will cost more by
Rs 1.89 per litre and diesel by Re 0.98 from April 1. Siddaramaiah has increased sales tax on petrol from 26% to 30% and diesel from 16.65% to 19%. A host of other commodities and services will also cost more in the coming days including soft drinks, beer, liquor, cable TV?subscription, private bus transport and agreement for sale of movable property.

The chief minister defended the move to hike sales tax of fuels by stating that the Centre increased the excise duties on petrol and diesel thrice during the last one year to compensate for the loss in revenue due to slash in crude oil prices, but the State government did not increase the tax rate.

The House passed the Karnataka Appropriation Bill, 2016 giving the government the authority to spend Rs 57,308 crore for expenditure up to July 31 by a voice vote. The House all passed other consequential bills pertaining to tax proposals in the budget.