Tax share of states in central pool should be revised to 50%'
February, 25th 2014
Making a strong representation before the 14th Fiannce Commission, Rajasthan Chief Minister Vasundhara Raje today said the share of states in Central taxes should be revised to 50 per cent from 32 per cent.
Underlining the major concerns of the state government with the 14th Finance Commission Chairman Y V Reddy at the Secretariat, the Chief Minister emphasised the need to ensure that the Finance Commission recommendations were implemented fully without any modifications and also without any delay in releasing the funds.
She said often the total funds recommended by the Commission to be released to the states as grants had never been fully delivered by the Central Government to the states.
Raje also underlined the need to constitute a standing federal council to oversee that the recommendations of the Finance Commission be implemented equitably and the states were not unfairly deprived of their due share of grants.
She said that the centrally sponsored schemes had fund allocations which run into over Rs 2 lakh crore and most of the schemes were implemented through mechanism outside the state budget which obscured responsibilities.
She also underlined that the artificial distinction between the plan and non-plan expenditure prevented badly required expenditure on non-plan items such as police and transport.
On primary education, she hoped that the 14th Commission would incentivise alternative methods of service delivery or infrastructure creation which was the need of the hour.
On state's finances, she said that they were under severe stress because of the so called populist schemes taken by the previous government with an eye of the Finance Commission.
Raje and cabinet colleagues said that there was an urgent need to set things right in the coming years.
Saying that the states be treated as partners by the Central Government, she said that the priorities of the State Government would be to increase investment eradicate unemployment improve the economic structure education and skill development and to deliver all public services keeping a high standard.
Reddy appreciated and complemented the Chief Minister for the excellent memorandum presented by the State Government, and said that the memorandum gave a clear insight into the Center and state relations and covered all points of terms of the reference of the Finance Commission.
He aggreed with the Chief Minister that ways and methodology had to be changed if things had to be set right and alternative models of service delivery had to be considered, according to a Chief Minister's Office's spokesman, adding that the Commission had noted all the concerns of the state government.
Other members of the commission Sushma Nath, Abhijit Sen, M Govinda Rao, Sudipto Mundle and A N Jha also complemented Raje for the excellent memorandum presented by the state government.