Bangalore: With eye on elections, Siddaramaiah presents state budget

With DHNS Inputs

Bangalore, Feb 14 (IANS): Karnataka's budget for ensuing 2014-15 spares the common man from new taxes but taxes those who drink beer and domestically-produced liquor.

Presenting the budget, Chief Minister Siddaramaiah Friday told the legislative assembly here that additional excise duty on beer would be increased 13 percent to 135 percent to mobilise additional resources.

"I propose to increase the additional excise duty on beer to 135 percent from 122 percent on 330 ml bottled beer priced at Rs.125 and above," Siddaramaiah said in his two-hour long budget speech.

Similarly, licence fee on primary distilleries, Indian liquor manufacturing distilleries and breweries has been increased 50 percent and on retail liquor shops to Rs.3 lakh from Rs.1 lakh.

The budget, however, proposes to lower value added tax (VAT) to 5.5 percent on liquor sold in bars and restaurants in urban areas, clubs, lodging houses and star hotels so as to maximise collection on value addition.

"As part of rationalisation effort, I propose to increase luxury tax on minimum daily rent to Rs.750 from Rs.500," said the chief minister, who also holds the finance portfolio.

Besides sparing the people, especially traders from increase in commercial taxes, the budget has reduced stamp duty on immoveable properties to 0.25-0.75 percent on slab basis from the prevailing flat 5 percent of their value.

"Similarly, stamp duty on joint development agreements and powers of attorney will be reduced to two percent," Siddaramaiah said.

The budget also proposes to exempt stamp duty on alternate sites allotted by the Bangalore Development Authority (BDA) in lieu of the land freed from government control (denotified) and on sale deeds executed under the state government's aerospace policy 2013-23.

Stamp duty will be reduced to 0.5 percent from 1 percent on imported goods, which are exempted from customs duty.

In the transport sector, the budget proposes to levy Rs.500 per seat per quarter on motor cabs costing Rs.15 lakh and registered in other states but entering Karnataka by obtaining tourist vehicle permit instead of paying life time tax.

In response to representations from various quarters, the budget has extended tax exemption on paddy, rice, wheat, pulses and their products.

To provide relief to small growers, Siddaramaiah also proposed to reduce tax on scented arecanut powder other than mixtures to 5.5 percent from 14.5 percent.

There will also be no entry tax on ethanol for mixing with petrol.

At a glance

Additional excise duty on beer hiked from 122% to 135%.

License fee for distilleries and breweries hiked by 50%.

Luxury taxis may become significantly more expensive. Rs 500 to be levied on luxury cabs per seat, per quarter.

Stamp duty exempted for alternative sites by BDA.

Key announcements:

A new policy to buy land for residential sites in rural and urban areas will be implemented.

Motor Vehicles Act to be amended to plug revenue loss from vehicles registered in other states plying on Karnataka roads. But no details on how this will be done.

Government to set up three 250-bed super speciality hospitals in Mysore, Gulbarga and Belgaum. These would serve critically ill patients. 

Government to set up one medical college in each district in phased manner. Six colleges to come up initially - one each in Tumkur, Haveri, Bagalkot, Yadgir, Chikkaballapur and Chitradurga.

Kaveri Tourism Authority to be set up to develop Mysore circle (Mysore, Mandya, Chamaraja Nagar and Kodagu districts)

Incentive to set up 'Janatha Cinema Halls' at district and taluq  HQs to exhibit Kannada films.

Rs 500 crore to Krishibhagya scheme to improve rainfed agriculture. The scheme will be implemented in 23 districts  to cover 45 lakh hectares.

Rs 1.5 crore for entertainment in old age homes through classical music, folk performances and other traditional art forms such as harikatha. Small money but significant gesture.

Bangalore

Rs 26,405 crore for the second phase of metro rail.

Development and widening of roads - Rs 300 crore

Development  of footpaths - Rs 100 crore

Development and protection of 31 lakes - Rs 100 crore

Implementation of parking policy - Rs 10 crore

Development of peripheral ring road - Rs 5800 crore

Solid waste management - Rs 100 crore

Development of arterial and sub-arterial roads - Rs 500 crore

Elevated road to be constructed from Chalukya to Hebbal junction.

Elevated road to be constructed from Alisada to Basaveshwara Circle.

BDA to construct 8000 flats.

Applications for 5000 sites in Kempegowda layout to be invited in March.

Education

Expert committee to prepare text books.

Online computer-aided education to be introduced.

Central university to be set up in Karwar.

Bangalore and Karnataka Virtual University to be set up.

10,000 students in standards 9 and 10 to be trained in IT, retail and healthcare.

Education Quality Monitoring Cell to be set up.

Allocations for different sectors

Water resources - Rs 11, 349 crore

Education - Rs 21, 305 crore

Energy - Rs 11, 693 crore

Urban Development - Rs 9995 crore

Social welfare - Rs 6475 crore

Women and child welfare - Rs 3670 crore

PWD - Rs 6634 crore

Rural Development - Rs 9361 crore

BBMP - Rs 1527 crore