Karnataka is set to lose about ₹15,000 crore every year due to GST rate rationalisation since October. The State’s revenue collection struggles as GST growth dropped to 3% from last year’s 12%. To bridge the gap, the government is looking at selling government land and auctioning 579 liquor licences expected to raise over ₹500 crore. However, doubts hover over land monetisation. A government source said, "The experiences in land monetisation in the past has shown that the expected revenue is not met, as auction price could be just above the government set guidance value and not the market value. We may not be able to realise the full value of the land and we will lose precious and scarce government land. There are chances of allegations of corruption too." Since May 2023, the Congress government has not auctioned any land. Borrowing is another option. Karnataka has planned to borrow ₹1.16 lakh crore this year but has taken only ₹4,265 crore so far. Usually, borrowing picks up in the last quarter. In 2024-25, the State borrowed almost ₹1 lakh crore against a target of ₹1.05 lakh crore. The excise department’s plan to auction liquor licences has met resistance. Senior Congress legislator B.R. Patil wrote to the Chief Minister opposing the move amid the ongoing Gandhi Bharath Abhiyan celebrations. A minister said, "Auctioning is a one-time revenue generation, and it cannot meet the huge revenue shortfall. The excise revenue is growing, but we cannot squeeze the sector all the time." Excise revenue did rise 11.33% between April and October 2025-26 compared to last year. Karnataka will also lose ₹6,000 to ₹7,000 crore from GST rationalisation and another ₹9,000 crore due to the Centre withholding cess revenue from tobacco and pan masala sales. Chief Minister Siddaramaiah's recent review showed the State might collect ₹1.05 lakh crore instead of the ₹1.2 lakh crore target for 2025-26. Central grants to Karnataka fell by nearly 27% between April and October 2025. Stamps and revenue department collection also dipped slightly by 0.42% compared to the previous year. Adding to the challenge, Karnataka plans huge spending including ₹75,000 crore for land acquisition in the Upper Krishna Project and ₹52,000 crore for flagship welfare schemes in the 2025-26 Budget. A minister summed up the tough times, "What is left with us after surrendering to GST? Increased borrowings could be one option too."