Congress leaders from Karnataka, led by Chief Minister Siddaramaiah, staged a protest at Jantar Mantar in the national capital on Wednesday, alleging “injustice” by the Centre in the devolution of taxes to the State.

While the BJP and the Central government have refuted the financial allegations made by the southern States,

another State, Kerala, led by CPI(M) veteran and Chief Minister Pinarayi Vijayan, along with his

cabinet colleagues, will stage a protest in Delhi on Thursday against the Centre’s alleged negligence toward the southern State.

Union Finance Minister Nirmala Sitharaman refuted Karnataka’s claims that the Centre is withholding its share of funds, calling them misleading. She also made some extremely strong comments, accusing the State’s ruling party, the Congress, of attempting to shatter the nation’s unity.

“The Congress is now siding with separatists... Two years ago, you saw Rahul Gandhi at JNU (Delhi’s Jawaharlal Nehru University). He stood with the ‘tukde-tukde’ gang. Today, the same slogans are being echoed in Tamil Nadu, and the party is not condemning it. Here also, the same language is being used in full-page ads,” said the Union Finance Minister.

The BJP has labelled Kerala Chief Minister Pinarayi Vijayan’s protest against the Central government’s alleged “financial embargo” on Kerala in the national capital on Thursday as “high political drama bankrolled by taxpayers’ money” and has attempted to undermine the Kerala government’s narrative that the Central government is responsible for Kerala’s fiscal crisis. It said the proposed protest against the Centre is simply “sheer politics” aimed at shifting the blame for its own “failure” onto the Modi government, as people are reportedly “angry” with the ruling alliance in Kerala.

Deputy Chief Minister DK Shivakumar, along with several MPs, ministers, and MLAs from Karnataka state, took part in the protest.

Congress alleged that “injustice” has been meted out to Karnataka in tax devolution and grants-in-aid over the past few years. The protesters demanded that the Centre rectify the losses to the tune of Rs 1.87 lakh crore allegedly incurred by Karnataka under the 15th Finance Commission. Siddaramaiah said this protest is not against the BJP but against the discrimination faced by Karnataka. Dismissing the BJP’s allegation that the protest aimed to stir up a north-south divide, he emphasized that the Congress wants the country to remain united but opposes discrimination against the southern States.

“We are raising the issue of discrimination by the government of India against the state of Karnataka and other southern states,” Siddaramaiah said while addressing the protesters. “This is why I wrote a letter to all the MPs of the BJP and the JD(S) asking them to participate in this agitation,” he added.

The Chief Minister highlighted that the formula used to devolve taxes to the States, particularly Karnataka, under the 14th Finance Commission was altered by the 15th Finance Commission. He called for reverting to the old formula to prevent revenue loss for his state and stated that they would submit a representation to the new Finance Commission for adopting the formula used by the 14th Finance Commission.

Shivakumar mentioned that Karnataka ranks second in Goods and Services Tax (GST) collection and is the largest contributor to the country’s revenue. “We are demanding our rights, we are demanding our share. The Karnataka government had requested drought relief funds from the Centre, but not a single rupee was provided,” he emphasized.

“We are the voice of Karnataka. We demand justice,” Shivakumar said.

Congress general secretary Jairam Ramesh said top leaders from Karnataka protested at the Jantar Mantar to safeguard the interests of the whole state.

“The Prime Minister talks big about ‘cooperative federalism’, but as usual that is just a jumla. His anti-democratic, anti-people views are evident in the repeated ANYAY to Karnataka, as well as other Opposition-ruled States — drought relief funds denied; food grains denied; projects delayed,” he said in a post on X while sharing his statement.

He said Karnataka and the “Congress demand NYAY - the immediate release of all funds rightfully due”.

“This is not a political protest by the Congress Party against the BJP, but a protest by the entire state to highlight unfair treatment by the Modi Government, urging all Indians to take notice of this injustice. The state government has invited all parties to join the protest to demand justice for Kannadigas, and defend the Constitutional principle of federalism,” Ramesh said in a statement.

“The economic ‘anyay’ done to Karnataka by the Modi Government since 2014 are numerous, totalling thousands of crores of funds diverted unfairly,” he alleged.

He claimed that the starkest examples of this “anyay” is that drought relief funds have been denied to Karnataka, as 223 out of 236 talukas of the State are grappling with the effects of drought, with 123 experiencing severe drought conditions.

Karnataka needs Rs 17,900 crore as compensation, and farmers have lost crops worth Rs 35,000 crore, but not a single rupee has been released by the Centre to address this critical situation, he said.

Ramesh said rice for the “Anna Bhagya” scheme was denied, after the Modi government on June 13, 2023, in a move of the Modi Government discontinued the direct sale of rice and wheat from the central pool to State governments.

“This was a direct attack to prevent implementation of the Karnataka government’s Anna Bhagya Yojana. Denying Kannadigas the right to free grains just because they voted for the Congress Party is the height of anti-national behaviour, especially by the Prime Minister,” he said.

Ramesh also alleged that Karnataka receives only Rs 12 out of every Rs 100 in taxes paid to the Centre, with the rest held by the Modi government. Under new formulas adopted by the 15th Finance Commission, Karnataka’s share of funds has fallen from 4.71 per cent to 3.65 per cent, representing a loss of over Rs. 1.87 lakh crore, he claimed.

“This consistent decline in the State’s share highlights a growing injustice towards Karnataka. While Karnataka is facing the worst of the anti-federal policy of the Modi Government today, there has been a sustained attack on federalism across the country,” he alleged.

The Congress leader said since 2014, the share of tax revenue collected as ‘cess’ or ‘surcharge’ has grown, from just around 10 percent to over 26 percent.

“Today, all Kannadigas, all Indians, and the Indian National Congress have a simple demand: Prime Minister Modi, end this ‘anyay-kaal’ for Karnataka and all Opposition states, and immediately release the funds that are rightfully due,” Ramesh said.