Karnataka chief minister plans ‘marginal’ tax hike

February 15th, 2010 - 9:53 pm ICT by IANS  

Pranab Mukherjee New Delhi/Bangalore, Feb 15 (IANS) Karnataka Chief Minister B.S. Yeddyurappa Monday said taxes will be increased “marginally” in the budget proposals for the ensuing 2010-11 fiscal.
“I will be presenting a surplus budget with a marginal increase in taxes to raise resources for developmental projects,” Yeddyurappa told reporters here during his day’s visit to the national capital.

The chief minister, who also holds the finance portfolio, is slated to present the budget March 5.

The state had a revenue surplus of Rs.1,150 crore in the last 2008-09 fiscal.

Noting that revenue inflows since January were catching up, Yeddyurappa said the government was confident of maintaining the fiscal deficit below 3.5 percent of the gross state development product (GSDP).

“The GSDP in the current fiscal (2009-10) is projected to be at 11 percent, which is likely to be the highest in the country,” the chief minister claimed after meeting Finance Minister Pranab Mukherjee.

Assuring students of regular power supply during their examination season, Yeddyurappa said the state would not hesitate to buy power from the central grid and independent private producers to minimise power cuts in the summer months.

The state has augmented 1,250 MW to the power grid during the last 19 months and will generate an additional 2,450 MW during fiscal 2011-12, including 1200 MW from Udupi thermal project, 500 MW each from Bellary thermal power project and green energy from renewable sources and 250 MW from the Raichur thermal station.

“We want to enter into long-term power purchasing agreements with private producers to maintain the cost at Rs.4.50 per unit,” Yeddyurappa said.

The state government has received central government clearance for setting up the eighth unit (250 mw) at the Raichur thermal station and the new 500 MW Yedlapura project in Raichur district, about 500 km from Bangalore.

“The budget proposals will also have guidelines on land utilisation for the industrial sector to ensure fertile lands are used only for agriculture,” Yeddyurappa added.

The month-long budget session of the Karnataka assembly will commence Feb 25, with an address by Governor H.R. Bhardwaj to the joint sitting of both houses.

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