On Thursday (21st March), the Karnataka government faced a significant setback as Governor Thawar Chand Gehlot declined to sign the controversial Temple Tax bill, raising concerns about the taxation of only Hindu temples. Advocating for the taxation of all religious bodies Gehlot stressed that singling out one religion for taxation under the proposed bill is discriminatory.
Governor Thawar Chand Gehlot’s withdrawal of the Karnataka Hindu Religious Institutions & Charitable Endowment (Amendment) Bill, 2024 came as a huge embarrassment for the Congress government in the state. The governor questioned whether other religious organisations would be included in this bill. He further asked the state government’s intention to enact similar legislation for non-Hindu religious institutions with amendments.
The Muzrai department (Department of Religious and Charitable Endowments) oversees approximately 35,000 Hindu religious institutions that receive funding from the Government of Karnataka.
This bill gives the government the right to collect more tax from temples. According to this bill, if the revenue of a Hindu temple is 1 crore rupees, then the government can take a 10% tax from the temple, and if the temple’s revenue is less than 1 crore but more than Rs 10 lakh, then the government can take 5% tax from the temple. Bharatiya Janata Party, in opposition in the state, had opposed this bill.
The bill additionally proposed the establishment of committees at both state and district levels tasked with “examining, evaluating, and presenting” proposals regarding infrastructure development for pilgrims.
The contentious draft called Hindu Religious Institutions & Charitable Endowment (Amendment) Bill, 2024 was passed in the Karnataka state legislative assembly on 21st February 2024. However, it faced defeat by a voice vote in the upper house on 23rd February 2024, where the BJP-led opposition held a majority. The Karnataka Temple Bill underwent reconsideration and was subsequently approved in both the Assembly and the Legislative Council on 1st March.
Opposition parties including the Bharatiya Janata Party (BJP) and Janata Dal (Secular), had condemned the bill, labeling it as anti-Hindu. They accused the Congress government in Karnataka of attempting to strengthen its financial position by utilising funds from temples. The opposition also argued that the Siddaramaiah administration wanted to redirect temple revenues to support other religions.
Previously, temples earning between ₹5 lakh and ₹10 lakh annually were required to contribute 5% of their net income to the Common Pool Fund, while those with incomes exceeding ₹10 lakh were mandated to allocate 10% of their net income to the fund.
Notably, if the Siddaramaiah government intends to obtain the Governor’s signature on the bill, they will have to pass the bill again in the Legislative Assembly. However, if the Governor decides to send the bill to the President, it could lead to reconsideration of the decision to tax temples by the Congress government.