The Central government, as per Union Minister Pralhad Joshi, has raised Karnataka’s share in central taxes from 3.647% to 4.131%. This adjustment means the state will now receive tax proceeds amounting to several thousand crore rupees. Joshi dismissed allegations by Congress leaders in Karnataka who claimed unfair treatment in tax revenue distribution.
In the 2026-27 Union Budget, Karnataka has been allocated Rs 63,049 crore as its share in central taxes, marking an increase from the previous year. The 16th Finance Commission’s report has maintained the overall tax devolution to states at 41%, with individual state shares being revised. This revision has led to Karnataka receiving a higher share of central taxes.
Union Finance Minister Nirmala Sitharaman’s economic roadmap for 2026-27, according to Joshi, aligns with Prime Minister Narendra Modi’s vision of Viksit Bharat. The budget emphasizes growth and production capacity enhancement across key sectors, with a notable allocation of Rs 10,000 crore for the biopharma industry to drive innovation and manufacturing in healthcare.
Karnataka Chief Minister Siddaramaiah criticized the 2026-27 Union Budget, calling it akin to a “municipality corporate budget” and expressing disappointment. He highlighted a reduction in the allocation for centrally sponsored schemes compared to the previous year’s budget. Siddaramaiah also expressed dissatisfaction with the lack of significant benefits for Karnataka in the form of high-speed railway projects.
