Five States Seek Fair Share of Taxes

• Surcharges and cesses have increased, constituting around one-fifth of the Union’s Gross Tax Revenue.
• The demand for a higher share for States in the taxes collected by the Union has continued relevance.
• The 16th Finance Commission is tasked with balancing the interests of States with low per capita income but larger population and those that have achieved the aims of the National Population Policy, 1976.
• Telangana Deputy Chief Minister Mallu Bhatti Vikramarka called for a recalibration of the Centre-States balance of power to ensure a truly federal system.
• Tamil Nadu Finance Minister Thangam Thennarasu emphasized the need for a 50% increase in the share of States in the divisible pool.
• Karnataka Revenue Minister Krishna Byre Gowda urged the 16th Finance Commission to cap the cesses and surcharges levied by the Centre at 5% of the gross tax revenue.
• Punjab Finance Minister Harpal Singh Cheema criticized the introduction of the Goods and Services Tax, stating it limited the fiscal autonomy of States.
• Kerala Finance Minister K.N. Balagopal emphasized the crisis of cooperative federalism and the increasing “subordinate federalism” or “coercive federalism”.