Karnataka Budget relies on growth, high levies to mop up revenue.

from BUSINESS LINE, February 25, 2011 Bangalore, Feb 24 - The Karnataka Budget for 2011-12 projects a fiscal deficit of 2.87 per cent of gross state domestic product (GSDP), assuming a growth rate of 8.5 per cent in real terms this fiscal and an inflation rate of 6 per cent. This fiscal deficit for 2010-11 is pegged at 3.44 per cent.

Briefing newspersons here on growth and inflation prospects, State Department officials also said that these assumptions were "in line with that of the Centre".

By pointing out that the GSDP grew by 8.2 per cent in real terms in 2010-11 and 16 per cent in nominal prices, the Budget acknowledges an inflation rate in Karnataka of 7.8 per …