Revenue generation won't be easy for Karnataka: Experts

Coronavirus Lockdown: Revenue generation won't be easy for B S Yediyurappa govt, caution experts

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The B S Yediyurappa administration may come out of the COVID-19 crisis unscathed, but generating revenues lost because of the lockdown will not be easy, especially with what some call “knee-jerk” reactions such as auctioning BDA corner sites. 

The proposed revenue generation measures, experts say, will be of little help due to the economic crisis caused by the lockdown.

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Speaking to DH, former chief secretary A Ravindra said that it would be difficult for the government to bridge the revenue deficit suffered by the state during the lockdown and would be the first of the many problems in the days ahead.

Noting that almost all the revenue generation streams of the state have either dried up or trickled in the last month or so, Ravindra suggested that the government must come up with a plan to mobilise more resources.

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“The government should constitute an expert committee to look into the question of resources. While it has proposed to auction of Bangalore Development Authority (BDA) sites, regularise unauthorised constructions, etc, the schemes will be successful only if people opt for them. At a time when everything is shut, the government won’t get the rates it is expecting,” he said.

‘Open up urban areas’

Another retired bureaucrat, who did not wish to be quoted, said that the measures proposed by the state were necessary to shore up funds.

“These are desperate times for everyone, especially the government. However, whether the government will be able to generate the revenue it anticipates remains to be seen,” he said.

Relaxing the lockdown - especially in urban areas – by identifying regions with no coronavirus cases was essential, so that the economy can return to normalcy and bring money to the government.

The government plans to auction nearly 12,000 corner sites belonging to the BDA to generate around Rs 15,000 crore.

Sources in the Finance Department told DH that the government cannot expect any significant improvement in revenue generation until the lockdown is relaxed in Bengaluru.

“Be it commercial taxes, stamps and registrations or motor vehicles tax, Bengaluru contributes 50% to 55%. Half of the revenue won’t come, if Bengaluru remains in total lockdown,” sources added.