H D Kumaraswamy keeps half a promise, waives of RS 34,000 crore farm loans

Jul 06, 2018, 08:49 IST | Agencies

In order to mop up additional revenue, the CM has hiked taxes on fuel and power in the maiden budget of JD(S) and Congress

H D Kumaraswamy keeps half a promise, waives of RS 34,000 crore farm loans
Karnataka Chief Minister H D Kumaraswamy reacts as he leaves after presenting the state budget, in Bengaluru, on Thursday. Pic/PTI

Keeping his pre-poll promise, Karnataka Chief Minister H D Kumaraswamy on Thursday announced a Rs34,000 crore farm loan waiver, but in a contentious move proposed hike in taxes on fuel and power in the maiden budget of the JD(S)-Congress coalition government.

Kumaraswamy, who holds the finance portfolio, said the increase in taxes on petrol, diesel, power and liquor was aimed at mopping up additional revenue to offset the burden on the exchequer caused by the farm loan waiver.

He, however, capped the agricultural loan to be written off at Rs 2 lakh, saying it would not be right to waive loans of higher value. He also said all defaulted crop loans up to December 31, 2017 would be written off in the first phase.

Rs 1.12
Amount by which the rate of tax on diesel would be increased

Rs 1.14
Amount by which the rate of tax on petrol would be increased

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