Karnataka State Budget Analysis 2024-25 PDF

Karnataka Budget Analysis 2024-25 The Chief Minister of Karnataka, Mr. Siddaramaiah, presented the Budget for the state for the financial year 2024- 25 on February 16, 2024. Budget Highlights  The Gross State Domestic Product (GSDP) of Karnataka for 2024-25 (at current prices) is projected to...

Karnataka Budget Analysis 2024-25 The Chief Minister of Karnataka, Mr. Siddaramaiah, presented the Budget for the state for the financial year 2024- 25 on February 16, 2024. Budget Highlights  The Gross State Domestic Product (GSDP) of Karnataka for 2024-25 (at current prices) is projected to be Rs 28,09,063 crore, amounting to growth of 9.4% over 2023-24.  Expenditure (excluding debt repayment) in 2024-25 is estimated to be Rs 3,46,409 crore, an increase of 17% over the revised estimates of 2023-24. In addition, debt of Rs 24,974 crore will be repaid by the state.  Receipts (excluding borrowings) for 2024-25 are estimated to be Rs 2,63,428 crore, an increase of 16% as compared to the revised estimates of 2023-24.  Revenue deficit in 2024-25 is estimated to be 1% of GSDP (Rs 27,354 crore), higher than the revised estimate for 2023-24 (0.54% of GSDP). In 2023-24, the revenue deficit is expected to be marginally higher than the budget estimate (0.49% of GSDP).  Fiscal deficit for 2024-25 is targeted at 3% of GSDP (Rs 82,981 crore). In 2023-24, as per the revised estimates, fiscal deficit is expected to be 2.7% of GSDP, marginally higher than the budget estimate (2.6%). Policy Highlights  Agriculture: New legislation will be enacted to establish a Marketing Development Assistance Fund, for the development of financially stressed Agricultural Produce Market Committees. A new scheme, the Karnataka Raitha Samruddhi Yojane, will be started to support farmers by consolidating existing schemes.  Economic Corridors: Two dedicated economic corridors will be developed between: (i) Mangaluru port and Bengaluru, and (ii) Bidar and Bengaluru.  Pragati Path Scheme: Under this scheme, road network of 9,450 km will be developed across 189 rural constituencies, at a cost of Rs 5,200 crore.  Labour: New legislation will be introduced to provide livelihood security for platform-based gig workers, by levying a cess on certain online transactions.  Energy: Installed power generation capacity will be increased from 32,000 MW to 60,000 MW over the next seven years. Karnataka’s Economy Figure 1: Growth in GSDP and sectors in Karnataka at constant prices (2011-12)  GSDP: In 2022-23, Karnataka’s GSDP (at 17.0% 20% 14.5% constant prices) grew at 7.9%, compared to 11% 11.0% 10.3% 10.1% in 2021-22. In comparison, national GDP is 15% 9.6% 9.5% 9.2% estimated to grow by 7.2% in 2022-23. 8.0% 7.9% 7.2% 6.4% 5.9% 10% 5.5% 5.1%  Sectors: The agriculture sector grew by 5.5% in 2022-23. In comparison, it witnessed 10% growth 5% in 2021-22. Manufacturing sector grew by 5% in 2022-23. Services grew by 9% in 2022-23. In 0% comparison, it grew by 10% in 2021-22. -5% -3.5% -3.5% -3.7% -3.9%  -6.0% In 2022-23, agriculture, manufacturing, and -10% services sectors are estimated to contribute 16%, 20%, and 64% to the economy, respectively (at -15% current prices). Agriculture Manufacturing Services GSDP Sector Sector Sector  Per capita GSDP: The per capita GSDP of 2018-19 2019-20 2020-21 2021-22 2022-23 Karnataka in 2022-23 (at current prices) is Note: Agriculture includes mining and quarrying; Manufacturing estimated at Rs 3,31,981, an increase of 13% over includes construction and electricity. These numbers are as per 2021-22. India’s per capita GDP in 2022-23 is constant prices (2011-12) which implies that the growth rate is estimated to be Rs 1,96,983. adjusted for inflation. Sources: Ministry of Statistics and Programme Implementation; PRS. Niranjana S Menon February 27, 2024 [email protected] PRS Legislative Research Institute for Policy Research Studies 3rd Floor, Gandharva Mahavidyalaya 212, Deen Dayal Upadhyaya Marg New Delhi – 110002 Tel: (011) 2323 4801, 4343 4035 www.prsindia.org  Karnataka Budget Analysis 2024-25 PRS Legislative Research Budget Estimates for 2024-25  Total expenditure (excluding debt repayment) in 2024-25 is targeted at Rs 3,46,409 crore. This is an increase of 17% over the revised estimates of 2023-24. This expenditure is proposed to be met through receipts (excluding borrowings) of Rs 2,63,428 crore and net borrowings of Rs 80,272 crore. Total receipts for 2024-25 (other than borrowings) are expected to register an increase of 16% over the revised estimates of 2023-24.  Revenue deficit in 2024-25 is estimated to be 1% of GSDP (Rs 27,354 crore), higher than the revised estimates for 2023-24 (0.5% of GSDP). Fiscal deficit for 2024-25 is targeted at 3% of GSDP (Rs 82,981 crore), higher than the revised estimates for 2023-24 (2.7% of GSDP). Table 1: Budget 2024-25 - Key figures (in Rs crore) % change from % change from 2022-23 2023-24 2023-24 2024-25 Items BE 23-24 to RE RE 23-24 to BE Actuals Budgeted Revised Budgeted 23-24 24-25 Total Expenditure 2,92,125 3,27,747 3,17,836 -3% 3,71,383 17% (-) Repayment of debt 15,942 22,441 22,441 0% 24,974 11% Net Expenditure (E) 2,76,183 3,05,306 2,95,395 -3% 3,46,409 17% Total Receipts 2,74,109 3,24,478 3,12,708 -4% 3,68,674 18% (-) Borrowings 44,549 85,818 85,818 0% 1,05,246 23% Net Receipts (R) 2,29,560 2,38,660 2,26,890 -5% 2,63,428 16% Fiscal Deficit (E-R) 46,622 66,646 68,505 3% 82,981 21% as % of GSDP 2.1% 2.6% 2.7% 3% Revenue Deficit -13,496 12,523 13,951 11% 27,354 96% as % of GSDP -0.6% 0.5% 0.5% 1% Primary Deficit 18,195 32,619 37,962 16% 43,747 15% as % of GSDP 0.8% 1.3% 1.5% 1.6% GSDP 21,81,217 25,67,340 25,67,340 0% 28,09,063 9% Note: BE is Budget Estimates; RE is Revised Estimates. Fiscal deficit figures are as reported by the state, without adjustments to account for loans given by the Central government for capital expenditure. Sources: Annual Financial Statement, Karnataka Budget 2024-25; PRS. Expenditure in 2024-25  Revenue expenditure for 2024-25 is proposed to Expenditure on five guarantees be Rs 2,90,531 crore, an increase of 21% over the In 2023-24, the government launched four guarantee schemes revised estimate of 2023-24. This includes the under various departments. These are (i) Gruha Lakshmi, (ii) expenditure on salaries, pensions, interest, grants, Gruha Jyothi, (iii) Shakthi, and (iv) Yuvanidhi. Along with the and subsidies. pre-existing scheme Annabhagya, these comprise five ‘guarantees’ provided to the public. In 2024-25, Rs 53,674  Capital outlay for 2024-25 is proposed to be Rs crore is proposed to be spent on these schemes. This is 47% 52,903 crore, an increase of 3% over the revised higher than the revised estimates for 2023-24. More than half estimate of 2023-24. Capital outlay indicates the the allocation has been made towards the Gruha Lakshmi expenditure towards creation of assets. scheme. Under this scheme, women heads of families below the poverty line are given Rs 2,000 monthly. In 2024-25, this  In 2024-25, loans and advances given by the state scheme has been allocated Rs 28,608 crore, which is 63% of are expected to be Rs 2,974 crore, lower than the the total estimated expenditure on social welfare and nutrition. revised estimates by 13%. Sources: Karnataka Budget 2024-25; PRS. Table 2: Expenditure budget 2024-25 (in Rs crore) % change from % change from 2022-23 2023-24 2023-24 2024-25 Items BE 23-24 to RE RE 23-24 to BE Actuals Budgeted Revised Budgeted 23-24 24-25 Revenue Expenditure 2,15,584 2,50,933 2,40,731 -4% 2,90,531 21% Capital Outlay 57,348 50,989 51,231 0% 52,903 3% Loans given by the state 3,250 3,385 3,433 1% 2,974 -13% Net Expenditure 2,76,183 3,05,306 2,95,395 -3% 3,46,409 17% Sources: Annual Financial Statement, Karnataka Budget 2024-25; PRS. Committed expenditure: Committed expenditure of a state typically includes expenditure on payment of salaries, pensions, and interest. A larger proportion of budget allocated for committed expenditure items limits the state’s flexibility to decide on other expenditure priorities such as capital outlay. In 2024-25, Karnataka is estimated to spend Rs 1,52,023 crore on committed expenditure, which is 58% of its estimated revenue receipts. This comprises spending on salaries (31% of revenue receipts), pension (12%), and interest payments (15%). In February 27, 2024 -2-  Karnataka Budget Analysis 2024-25 PRS Legislative Research 2024-25, expenditure towards pensions is estimated to be 29% higher than the revised estimate for 2023-24. In 2022-23, as per actual figures, 45% of revenue receipts were spent towards committed expenditure. Table 3: Committed Expenditure in 2024-25 (in Rs crore) % change from % change from 2022-23 2023-24 2023-24 2024-25 Committed Expenditure BE 23-24 to RE RE 23-24 to BE Actuals Budgeted Revised Budgeted 23-24 24-25 Salaries 50,061 68,247 65,003 -5% 80,434 24% Pension 24,020 25,116 25,116 0% 32,355 29% Interest payment 28,427 34,027 30,543 -10% 39,234 28% Committed Expenditure 1,02,508 1,27,390 1,20,662 -5% 1,52,023 26% Sources: Annual Financial Statement, Karnataka Budget 2024-25; PRS. Sector-wise expenditure: The sectors listed below account for 64% of the total expenditure on sectors by the state in 2024-25. A comparison of Karnataka’s expenditure on key sectors with that by other states is shown in Annexure 1. Table 4: Sector-wise expenditure under Karnataka Budget 2024-25 (in Rs crore) % 2024-25 change 2022-23 2023-24 2023-24 Sector Budgete from RE Demand Provisions Actuals Budgeted Revised d 23-24 to BE 24-25  Rs 28,608 crore has been allocated towards Social Welfare and 16,045 34,834 35,947 45,281 26% the Gruha Lakshmi scheme, 63% more than Nutrition the budget estimates for 2023-24.  Block grants worth Rs 22,209 crore will be Education, Sports, Arts, provided for school education and literacy. 32,853 33,271 31,809 40,945 29% and Culture  Rs 1,553 crore has been allocated for the Aksharadasoha (Mid-day Meal Scheme).  Rs 9,744 crore has been allocated to the Annabhagya scheme. Agriculture and Allied 17,381 22,158 20,364 15%  Interest subsidy scheme for crop loans, Activities 23,357 pledge loans, and self-help groups has been allocated Rs 1,576 crore.  Rs 12,786 crore has been allocated for subsidies for the supply of free power to Energy 14,827 22,662 21,060 23,100 10% irrigation pumpsets.  Rs 9,657 crore has been allocated towards the Gruha Jyothi scheme. Irrigation and Flood  Rs 15,410 crore has been allocated for 23,112 19,057 19,057 1% Control 19,194 capital outlay on medium irrigation. Health and Family  Rs 4,332 crore has been allocated towards 12,539 14,761 14,400 14% Welfare 16,356 medical education.  Rs 7,212 crore has been allocated towards capital outlay on roads and bridges. Transport 20,474 15,023 14,794 5%  Rs 5,015 crore has been allocated towards 15,509 the Shakthi Scheme, which provides free bus travel to women.  Rs 5,125 crore has been allocated towards Welfare of SC, ST, the welfare of scheduled castes. 10,830 10,972 11,313 13,334 18% OBC, and Minorities  Rs 3,489 crore is allocated for the welfare of backward classes.  Rs 7,034 crore has been allocated for police Police 8,538 10,011 9,638 11,572 20% establishments in existing districts.  Mahatma Gandhi National Rural Employment Guarantee Scheme has been allocated Rs 2,390 crore. Rural Development 11,498 9,494 9,564 10,304 8%  Grants worth Rs 2,241 crore will be provided to Gram Panchayats, as recommended by the 15th Finance Commission. % of total expenditure 62% 64% 64% 64% on all sectors Sources: Annual Financial Statement, Detailed Budget Estimates of Expenditure, Karnataka Budget 2024-25; PRS. February 27, 2024 -3-  Karnataka Budget Analysis 2024-25 PRS Legislative Research Receipts in 2024-25  Total revenue receipts for 2024-25 are estimated to be Rs 2,63,428 crore, an increase of 16% over the revised estimate of 2023-24. Of this, Rs 2,03,393 crore (77%) will be raised by the state through its own resources, and Rs 59,785 crore (23%) will come from the centre. Resources from the centre will be in the form of state’s share in central taxes (17% of revenue receipts) and grants (6% of revenue receipts).  Central Transfers: In 2024-25, devolution, or the state’s share in central taxes is estimated at Rs 44,485 crore, an increase of 10% over the revised estimates of 2023-24. Grants from the centre in 2024-25 are estimated at Rs 15,300 crore, an increase of 8% over the revised estimates for 2023-24.  State’s own tax revenue: Karnataka’s total own tax revenue is estimated to be Rs 1,89,893 crore in 2024- 25, an increase of 18% over the revised estimate of 2023-24. Own tax revenue as a percentage of GSDP is estimated at 6.8% in 2024-25, higher than the revised estimates for 2023-24 (6.2%). As per the actual figures for 2022-23, own tax revenue as a percentage of GSDP was 6.6%. Table 5: Break-up of the state government’s receipts (in Rs crore) % change from % change from 2022-23 2023-24 2023-24 2024-25 Items BE 2023-24 to RE 2023-24 to Actuals Budgeted Revised Budgeted RE 2023-24 BE 2024-25 State's Own Tax 1,43,702 1,73,303 1,60,303 -8% 1,89,893 18% State's Own Non-Tax 13,914 12,500 12,000 -4% 13,500 12% Share in Central Taxes 34,596 37,252 40,281 8% 44,485 10% Grants-in-aid from Centre 36,867 15,355 14,196 -8% 15,300 8% Revenue Receipts 2,29,080 2,38,410 2,26,780 -5% 2,63,178 16% Non-debt Capital Receipts 481 250 110 -56% 250 127% Net Receipts 2,29,560 2,38,660 2,26,890 -4.9% 2,63,428 16% BE is Budget Estimates; RE is Revised Estimates. Sources: Annual Financial Statement, Karnataka Budget 2024-25; PRS.  In 2024-25, State GST (SGST) is Finance Commission (FC) Grants to Local Bodies estimated to be the largest source of The 15th FC recommended local body grants for Karnataka worth Rs 10,996 own tax revenue (46% share). SGST crore between 2021-22 and 2023-24. A significant proportion of these local revenue is estimated to increase by 21% body grants are released upon certain conditions being met. Some of the over the revised estimates of 2023-24. grant conditions are: (i) online availability of annual urban local body (ULB) In 2022-23, actual SGST revenue was accounts, (ii) notifying floor rate of property tax, and (iii) improving air quality. 15% higher than the budget estimate. In In the first two years of the FC grant period, ULB grants fell short of the 2021-22, this figure was 9%. recommended amount. Karnataka received 76% of ULB grants in 2021-22  Revenue from state excise in 2024-25 is and 61% in 2022-23. In 2022-23 it received 85% of the recommended rural local body grants. An inability to meet the grant conditions may have led to expected to see a 12% increase as lower amounts being released. For 2023-24, 31% of the recommended local compared to the revised estimates for body grant amount for Karnataka has been released as of December 14, 2023. 2023-24. State excise revenue is estimated to be 20% of Karnataka’s own Sources: Karnataka Budget 2023-24 and 2024-25; Unstarred question no. tax revenue. 1819, Rajya Sabha, December 19, 2023; PRS. Table 6: Major sources of state’s own-tax revenue (in Rs crore) % change from % change from 2022-23 2023-24 2023-24 2024-25 Head BE 23-24 to RE RE 23-24 to BE Actuals Budgeted Revised Budgeted 23-24 24-25 State GST 61,403 76,150 71,367 -6% 86,475 21% State Excise 29,920 36,000 34,500 -4% 38,525 12% Stamps Duty and Registration Fees 17,726 25,000 20,000 -20% 26,000 30% Sales Tax/ VAT 19,082 21,100 20,486 -3% 22,125 8% Taxes on Vehicles 10,611 11,500 11,400 -1% 13,000 14% Taxes and Duties on Electricity 3,052 2,049 1,149 -44% 2,006 75% Land Revenue 364 104 104 0% 362 249% GST Compensation Grants 20,288 2,350 1,191 -49% 0 - GST Compensation Loans 0 0 0 - 0 - Sources: Annual Financial Statement, Revenue Budget, and Karnataka Budget 2024-25; PRS. February 27, 2024 -4-  Karnataka Budget Analysis 2024-25 PRS Legislative Research Deficits, Debt, and FRBM Targets for 2024-25 The Karnataka Fiscal Responsibility Act, 2002 provides annual targets to progressively reduce the outstanding liabilities, revenue deficit and fiscal deficit of the state government. Revenue deficit: It is the difference of revenue expenditure and revenue receipts. A revenue deficit implies that the government needs to borrow to finance those expenses which do not increase its assets or reduces its liabilities. The budget estimates a revenue deficit of Rs 27,354 crore (or 1% of the GSDP) in 2024-25. Fiscal deficit: It is the excess of total expenditure over total receipts. This gap is filled by borrowings by the government and leads to an increase in total liabilities. In 2024-25, the fiscal deficit is estimated to be 3% of GSDP. For 2024-25, the central government has permitted fiscal deficit of up to 3.5% of GSDP to states, of which 0.5% of GSDP will be available only upon carrying out certain power sector reforms. As per the revised estimates, in 2023-24, the fiscal deficit of the state is expected to be 2.7% of GSDP. This is marginally higher than the budget estimate (2.6%). Fiscal deficit is projected to be lowered to 2% of GSDP by 2027-28. Composition of Outstanding Liabilities Outstanding liabilities: Outstanding liabilities is the accumulation of total Karnataka’s outstanding liabilities include public debt, public account liabilities, and borrowings at the end of a financial off-budget borrowings. Between 2021-22 and 2024-25, the share of each of these year, it also includes any liabilities on components in the total liabilities has changed. The share of public debt is estimated to increase from 75% in 2021-22 to 78% in 2024-25. This is primarily due public account. At the end of 2024-25, to an increase in open market borrowings (from 68% of total liabilities to 71%). The the outstanding liabilities are estimated share of public account liabilities is estimated to decrease to 21% of total liabilities in to be 24% of GSDP, higher than the 2024-25, from 25% in 2022-23 and 23% in 2023-24 (as per revised estimates). Off- revised estimate for 2023-24 (23% of budget borrowings are also estimated to decrease significantly, from Rs 17,306 GSDP). Outstanding liabilities rose crores in 2022-23 to Rs 7,507 crore in 2024-25. In March 2022, the central significantly in 2021-22 (to 27% of government decided to include states’ off budget borrowings when deciding the net GSDP), but have remained below 25% borrowing ceiling. of GSDP since then. Source: Karnataka Budget 2024-25; PRS. Figure 2: Revenue and Fiscal Balance (% of GSDP) Figure 3: Outstanding Liabilities (as % of GSDP) 2% 40% 1% 0.6% 0.1% 0.1% 0% 30% 26.7% -1% -0.5% -0.3% 24.0% 22.6% 23.7% 23.8% 23.9% 24.0% -1.1% -0.8% -1.0% -0.7% 22.4% -2% 19.9% -2.1% -2.0% 20% -3% -2.3% -2.4% -2.7% -3.0% -2.7% -4% -3.7% -3.8% -5% 10% -6% 2025-26* 2026-27* 2027-28* 2019-20 2020-21 2022-23 2024-25 BE 2023-24 RE 2021-22 0% 2025-26* 2026-27* 2027-28* 2019-20 2020-21 2022-23 2023-24 RE 2024-25 BE 2021-22 Revenue Balance Fiscal Balance Note: *Figures for 2025-26 and 2026-27 are projections; RE is Note: *Figures for 2025-26 onwards are projections; RE is Revised Revised Estimates; BE is budget estimates. Estimates; BE is budget estimates. Sources: Medium Term Fiscal Policy, Karnataka Budget 2024-25; Sources: Medium Term Fiscal Policy, Karnataka Budget 2024-25; PRS. PRS. Outstanding Government Guarantees: Outstanding liabilities of states do not include a few other liabilities that are contingent in nature, which states may have to honour in certain cases. State governments guarantee the borrowings of State Public Sector Enterprises (SPSEs) from financial institutions. As of March 31, 2023, the state’s outstanding guarantee is estimated to be Rs 38,356 crore, which is 17% of Karnataka’s revenue receipts in 2022-23. DISCLAIMER: This document is being furnished to you for your information. You may choose to reproduce or redistribute this report for non-commercial purposes in part or in full to any other person with due acknowledgement of PRS Legislative Research (“PRS”). The opinions expressed herein are entirely those of the author(s). PRS makes every effort to use reliable and comprehensive information, but PRS does not represent that the contents of the report are accurate or complete. PRS is an independent, not-for-profit group. This document has been prepared without regard to the objectives or opinions of those who may receive it. February 27, 2024 -5-  Karnataka Budget Analysis 2024-25 PRS Legislative Research Annexure 1: Comparison of states’ expenditure on key sectors The graphs below compare Karnataka’s expenditure in 2024-25 on six key sectors as a proportion of its total expenditure on all sectors. The average for a sector indicates the average expenditure in that sector by 31 states (including Karnataka) as per their budget estimates of 2023-24.1  Agriculture: Karnataka has allocated 6.8% of its total expenditure towards agriculture, which is higher than the average expenditure on agriculture by states (5.9%).  Energy: Karnataka has allocated 6.7% of its total expenditure towards energy, which is higher than the average allocation by states (4.7%).  Education: Karnataka has allocated 11.9% of its expenditure on education in 2024-25. This is lower than the average allocation for education by states in 2023-24 (14.7%).  Urban Development: Karnataka has allocated 0.6% of its total expenditure towards urban development, which is lower than the average allocation for urban development by states (3.4%).  Rural development: Karnataka has allocated 3% of its expenditure on rural development. This is lower than the average allocation for rural development by states (5%).  Irrigation: Karnataka has allocated 5.6% of its expenditure towards irrigation. This is higher than the average allocation towards irrigation by states (3.4%). Spending on agriculture as a Spending on energy as a % of Spending on education as a % of total expenditure total budget % of total expenditure 7.3% 7.0% 6.8% 7.5% 7.2% 8% 6.4% 8% 6.7% 20% 5.9% 14.7% 6% 6% 5.4% 15% 12.0% 4.7% 11.0%10.9%11.9% 4% 4% 10% 2% 2% 5% 0% 0% 0% 2022-23 2023-24 (RE) 2023-24 (BE) 2024-25 (BE) Average of all states 2022-23 2023-24 (RE) 2023-24 (BE) 2024-25 (BE) Average of all states 2022-23 2023-24 (RE) 2023-24 (BE) 2024-25 (BE) Average of all states (2023-24 BE) (2023-24 BE) (2023-24 BE) Spending on urban Spending on rural Spending on irrigation as a development as a % of total development as a % of total % of total budget budget expenditure 10% 8.5% 4% 3.4% 3.4% 6% 5.0% 8% 4.2% 6.3% 6.5% 3% 5.6% 4% 3.1% 3.3% 3.0% 6% 2% 4% 3.4% 2% 1% 0.6% 0.6% 2% 0.3% 0% 0% 0% 2022-23 2023-24 (RE) 2023-24 (BE) 2024-25 (BE) Average of all states 2022-23 2023-24 (RE) 2023-24 (BE) 2024-25 (BE) Average of all states 2022-23 2023-24 (RE) 2023-24 (BE) 2024-25 (BE) Average of all states (2023-24 BE) (2023-24 BE) (2023-24 BE) Note: 2022-23, 2023-24 (BE), 2023-24 (RE), and 2024-25 (BE) figures are for Karnataka. Sources: Annual Financial Statement, Karnataka Budget 2024-25; various state budgets; PRS. 1 The 31 states include the Union Territories of Delhi, Jammu and Kashmir, and Puducherry. February 27, 2024 -6-  Karnataka Budget Analysis 2024-25 PRS Legislative Research Annexure 2: Comparison of 2022-23 Budget Estimates and Actuals The following tables compare the actuals of 2022-23 with budget estimates for that year. Table 7:Overview of Receipts and Expenditure (in Rs crore) Particular 2022-23 BE 2022-23 Actuals % change from BE to Actuals Net Receipts (1+2) 1,89,977 2,29,560 21% 1. Revenue Receipts (a+b+c+d) 1,89,888 2,29,080 21% a. Own Tax Revenue 1,26,883 1,43,702 13% b. Own Non-Tax Revenue 10,941 13,914 27% c. Share in central taxes 29,783 34,596 16% d. Grants-in-aid from the Centre 22,281 36,867 65% Of which GST compensation grants 5,000 20,288 306% 2. Non-Debt Capital Receipts 89 481 437% 3. Borrowings 72,000 44,549 -38% Of which GST compensation loan 0 0 - Net Expenditure (4+5+6) 2,51,541 2,76,183 10% 4. Revenue Expenditure 2,04,587 2,15,584 5% 5. Capital Outlay 43,573 57,348 32% 6. Loans and Advances 3,382 3,250 -4% 7. Debt Repayment 14,179 15,942 12% Revenue Balance -14,699 13,496 -192% Revenue Balance (as % of GSDP) -0.7% 0.6% Fiscal Deficit 61,564 46,622 -24% Fiscal Deficit (as % of GSDP) 2.82% 2.1% Source: Karnataka Budget Documents of various years; PRS. Table 8: Key Components of State's Own Tax Revenue Tax Source/Head 2022-23 BE 2022-23 Actuals % change from BE to Actuals State Excise 29,000 29,920 3% Taxes and Duties on Electricity 2,823 3,052 8% Sales Tax/ VAT 17,640 19,082 8% State GST 53,220 61,403 15% Stamps Duty and Registration Fees 15,000 17,726 18% Taxes on Vehicles 8,007 10,611 33% Land Revenue 43 364 752% Source: Karnataka Budget Documents of various years; PRS. Table 9: Allocation towards Key Sectors Sector 2022-23 BE 2022-23 Actuals % change from BE to Actuals Health and Family Welfare 14,368 12,539 -13% Water Supply and Sanitation 7,053 6,268 -11% Agriculture and Allied Activities 17,039 17,381 2% Social Welfare and Nutrition 15,528 16,045 3% Education, Sports, Arts, and Culture 32,018 32,853 3% Police 8,007 8,538 7% Housing 3,659 4,031 10% Irrigation and Flood Control 20,652 23,112 12% Welfare of SC, ST, OBC, and Minorities 9,180 10,830 18% Energy 12,226 14,827 21% Rural Development 9,295 11,498 24% Transport 12,105 20,474 69% of which Roads and Bridges 10,276 15,376 50% Urban Development 5,685 9,222 62% Source: Karnataka Budget Documents of various years; PRS. February 27, 2024 -7-