Karnataka surpasses Delhi as 2nd largest direct tax contributor in FY24: Report

For the first time in seven years, Karnataka has surpassed Delhi in income and corporate tax contributions.

Published on: Oct 26, 2024, 12:26:54 IST

By HT News Desk

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Karnataka has overtaken Delhi to become the second-largest contributor to direct tax collections, according to a report released by the State Bank of India, Deccan Herald reported.

Tamil Nadu and Gujarat rank fourth and fifth, contributing 6.5 per cent and 4.8 per cent to direct tax revenue.

According to the report, in the fiscal year 2023-24, Karnataka accounted for 11.9 per cent of the total direct tax revenue, following Maharashtra's 38.9 per cent. Delhi ranked third with 10.4 per cent.

The SBI Research report indicates that Tamil Nadu and Gujarat rank fourth and fifth, contributing 6.5 per cent and 4.8 per cent to direct tax revenue, respectively. Collectively, the top five states account for over 70 per cent of the total direct tax revenue collected by the Centre.

For the first time in seven years, Karnataka has surpassed Delhi in income and corporate tax contributions. Delhi held the second position from 2017-18 to 2022-23, according to the SBI Research report.

(Also Read: Karnataka govt may impose 1-2% fee on platforms like Zomato, Swiggy; Cabinet to discuss on Oct 24: Report)

'Injustice to Karnataka in tax devolution'

Earlier this month, Deputy Chief Minister D.K. Shivakumar criticised the Centre for allegedly shortchanging Karnataka in tax devolution funding. He stated that the Congress-led state government would actively oppose this perceived injustice.

Shivakumar, also the state Congress chief, attacked BJP MPs and union ministers from the state for remaining silent on the issue and termed it "shameful."

"Injustice has happened to Karnataka. They have given more to Uttar Pradesh and Bihar. We were given less than even Andhra Pradesh, which doesn't contribute much in tax. We will fight and protest this in the days ahead," Shivakumar said.

The union government on Thursday released tax devolution of ₹1,78,173 crore to the state governments, including one advance instalment of ₹89,086.50 crore in addition to the regular instalment due for October 2024.

Karnataka got ₹6,498 crore in the state-wise distribution of net proceeds of union taxes and duties for October 2024.

(Also Read: CM Siddaramaiah slams Karnataka BJP MPs over state's tax devolution ‘injustice’, urges public action)

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