Bengaluru: With only four days remaining for the presentation of the State Budget, Chief Minister Siddaramaiah is reportedly considering a serious proposal to impose additional taxes on petrol and diesel. While the conflict in the Middle East has already triggered fears of a global crude oil price hike, the State Government’s move to increase prices further has caused widespread anxiety among the public.

Struggle for Resource Mobilization

There are growing concerns that the implementation of the government’s 'Guarantee' schemes has placed a heavy burden on the state exchequer. Recent statements by Minister Satish Jarkiholi regarding the state's financial difficulties have added weight to these claims. As the revenue collection targets for various departments have already reached their peak, the government finds it inevitable to search for new sources of income.

₹1 Hike Proposal Before the CM

Officials from the Finance Department have placed a proposal before the Chief Minister to levy an additional sales tax of ₹1 per liter on petrol and diesel. According to official estimates, this move would bring significant revenue to the state treasury. However, the government is also wary of the public backlash such a decision might provoke. Consequently, Chief Minister Siddaramaiah has not yet taken a final call.

History Repeating Itself?

In 2024, Siddaramaiah had increased the sales tax on petrol to 29.84%, which made petrol dearer by ₹3 per liter. At that time, the CM justified his decision by stating that "taxes in Karnataka are lower compared to neighboring states." It appears that the government is now likely to tread the same path again.

The Chain Reaction of Price Hikes

Currently, the price of petrol in Bengaluru is approximately ₹103.37 and diesel is ₹90.99. If the price hike is announced in the budget:

Impact on Commuters: Vehicle owners will feel the direct pinch in their pockets.

Cost of Living: Increased freight and transportation costs could lead to a rise in the prices of essential commodities, including vegetables and daily goods.

Overall, amidst the ongoing 'Guarantees,' this potential 'gift' of a price hike in the budget is likely to be a hard pill for the common man to swallow.