Karnataka Chief Minister D.K. Shivakumar on Friday, 21 August called upon chartered accountants to partner with the state government in strengthening revenue collection, sealing financial leakages, and correcting fiscal lapses — all without imposing additional burdens on trade and industry. He was addressing a dialogue conference organised by the Institute of Chartered Accountants of India (ICAI) at Palace Grounds, Bengaluru.

Key Developments

Shivakumar described his government as an 'open book' and invited the accounting community to submit concrete proposals. 'Our government is open to new ideas and solutions. Give us your suggestions to prevent mistakes and plug resource leakages,' he said. He praised chartered accountants as 'guardians of trust' and urged them to guide the government in increasing revenues while protecting taxpayers and businesses alike.

The Chief Minister also raised concern over what he described as the harassment of honest taxpayers by government agencies. 'Honest taxpayers are subjected to mental harassment by officials. Those who indulge in theft are not questioned. Around 12 lakh entrepreneurs have left the country, saying they have had enough of the Income Tax Department, the ED, and the CBI,' he alleged.

Karnataka's Fiscal Position

Shivakumar positioned Karnataka as the second-highest tax-paying state in India and claimed the state accounts for 42 per cent of India's software exports. He noted that Bengaluru now hosts approximately two lakh foreign passport holders and that the city's population has grown from around 70 lakh twenty-five years ago to 1.4 crore today, with vehicles numbering close to 1.35 crore.

The state government, he said, currently spends around ₹52,000 crore annually on its guarantee schemes and roughly ₹20,000 crore on providing free electricity to farmers' pump sets, in addition to various pension commitments. He asked chartered accountants directly: 'Tell us how the government can increase revenue without causing hardship to trade and industry.'

South India's Contribution and Federal Claims

Shivakumar made a pointed argument for a fair share of central resources for southern states, telling the gathering that 'South India is the fuel for India's progress. India cannot progress without South India.' He said he had made this case before Union Home Minister Amit Shah at a recent meeting. He also referred to the Southern Zonal Council meeting held in Chennai on Thursday, where he raised issues specific to Karnataka and the region.

Comparing Karnataka's financial discipline with other states, Shivakumar claimed that around 90 per cent of transactions in Karnataka were conducted through accounted money, contrasting this with what he alleged was only 30 per cent in Gujarat during a visit he made a few years ago. These figures were not independently verified.

CSR, Compliance, and the Road Ahead

The Chief Minister urged chartered accountants to guide industries on the effective utilisation of Corporate Social Responsibility (CSR) funds, particularly toward strengthening primary education in rural Karnataka. He said a policy was being formulated to direct CSR resources in this area.

Shivakumar also noted that workers from northeastern states were arriving in Karnataka for services-sector employment, while northern-state workers were active in construction and traders from Andhra Pradesh were doing business in the state. He urged chartered accountants to help these businesses and workers improve earnings and ensure tax compliance.

Concluding his address, Shivakumar extended Varamahalakshmi festival greetings and assured the audience that his government would follow through on its commitment to work alongside the accounting profession. With Karnataka's fiscal pressures mounting and guarantee-scheme expenditure rising, the state's ability to grow revenues without stifling enterprise will be a defining challenge for the administration in the months ahead.