Telangana govt seeks 50% share in central taxes from 16th Finance Commission

The Telangana Government urged the 16th Finance Commission to raise the state's share in Central taxes from 41% to 50% to improve fiscal space for welfare and development. 

Livemint
Updated10 Sep 2024, 02:47 PM IST
File image of Telangana Deputy Chief Minister and Finance Minister Bhatti Vikramarka Mallu presenting the state budget in Hyderabad in July 2024.
File image of Telangana Deputy Chief Minister and Finance Minister Bhatti Vikramarka Mallu presenting the state budget in Hyderabad in July 2024.(Mohammed Aleemuddin / ANI)

The Telangana Government on September 10 has asked the 16th Finance Commission to increase its share of Central taxes from the existing 41 per cent to 50 per cent, PTI reported.

The request comes as cesses and surcharges by the Centre that are not shared with states have increased over the years, Deputy Chief Minister and state Finance Minister Bhatti Vikramarka told Finance Commission Chairman Arvind Panagariya, as per the report.

During the meeting with Panagariya, Vikramarka urged the 16th Finance Commission to also consider “necessary autonomy” for states to tailor their centrally sponsored scheme (CSS) programmes as per specific requirements, the report added.

Also Read | Apple iPhone 16, iPhone 16 Plus: CEO Tim Cook says, ‘Welcome to new era of…’

On Central taxes share for states…

“We propose increasing the share of states in Central taxes from 41 per cent to 50 per cent. Over the years, cesses and surcharges that are not shared with states have increased, leaving states with a smaller share of total gross tax revenue,” he said.

He noted that increasing the vertical devolution “will give states the fiscal space they need to strengthen welfare programmes, address infrastructure gaps and prioritise local development”.

Vikramarka added that the demand is “not just for Telangana, but for all states”, to ensure a “more cooperative federal structure”.

Also Read | Hurun India Rich List says THIS Infosys co-founder richer than Narayana Murthy…

On Measure to Determine Resource Allocation…

He also proposed that the Panel “reconsider the use of per capita income distance as the primary indicator in determining horizontal devolution as measuring prosperity”, stating that sole use of this measure “would deny Telangana the resources needed to address inequities that exist within the state”.

The state government is suggesting that the formula for horizontal devolution be modified to add at least a 50 per cent weightage to gross state domestic production (GSDP) contribution.

“A greater weight on GSDP would incentivise states to adopt reforms that improve productivity, attract investment and create jobs, ultimately contributing to the national economy. This approach would not only make states more competitive but also help reduce regional disparities, encouraging more balanced growth across the country,” he said.

Also Read | Bank holidays: Will banks be closed for six days in a row? Check here

On Recognising Welfare Investments…

Vikramarka also objected to the “mislabelling” of government expenditure on welfare schemes such as Rythu Bharosa, farm loan waivers and food subsidies as “freebies”, and asked the Panel to recognise the necessity of such programmes as “investments in the welfare of our people”.

Also Read | Prince Harry closer to Princess Diana’s family, gets Christmas invite: Report

On Debt Servicing…

He mentioned that a large part of the state's resources is now being diverted toward debt servicing and requested the Panel's support to either restructure this debt or provide additional assistance to help free up resources, as per the report.

The 16th Finance Commission has been visiting Telangana since September 9 and has held meetings with political parties, local body representatives, and industry chambers.

(With inputs from PTI)

Catch all the Business News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.

MoreLess
First Published:10 Sep 2024, 02:47 PM IST
Business NewsNewsIndiaTelangana govt seeks 50% share in central taxes from 16th Finance Commission

Get Instant Loan up to ₹10 Lakh!

  • Employment Type

    Most Active Stocks

    Axis Bank share price

    1,181.30
    03:29 PM | 4 OCT 2024
    5.85 (0.5%)

    Tata Steel share price

    166.75
    03:56 PM | 4 OCT 2024
    -0.2 (-0.12%)

    Oil & Natural Gas Corporation share price

    295.20
    03:58 PM | 4 OCT 2024
    3.1 (1.06%)

    Tata Motors share price

    930.70
    03:56 PM | 4 OCT 2024
    4.7 (0.51%)
    More Active Stocks

    Market Snapshot

    • Top Gainers
    • Top Losers
    • 52 Week High

    Mahindra & Mahindra Financial share price

    301.65
    03:29 PM | 4 OCT 2024
    -20.5 (-6.36%)

    Kfin Technologies share price

    1,015.00
    03:29 PM | 4 OCT 2024
    -63.85 (-5.92%)

    Godrej Properties share price

    2,897.70
    03:57 PM | 4 OCT 2024
    -170.55 (-5.56%)

    Adani Energy Solutions share price

    963.45
    03:58 PM | 4 OCT 2024
    -52.75 (-5.19%)
    More from Top Losers

    VIP Industries share price

    563.85
    03:57 PM | 4 OCT 2024
    40.8 (7.8%)

    Oil India share price

    572.25
    03:59 PM | 4 OCT 2024
    33.4 (6.2%)

    JK Paper share price

    489.95
    03:43 PM | 4 OCT 2024
    27.1 (5.86%)

    Home First Finance Company India share price

    1,245.35
    03:40 PM | 4 OCT 2024
    63.15 (5.34%)
    More from Top Gainers

    Recommended For You

      More Recommendations

      Gold Prices

      • 24K
      • 22K
      Bangalore
      77,685.00-10.00
      Chennai
      77,691.00-10.00
      Delhi
      77,843.00-10.00
      Kolkata
      77,695.00-10.00

      Fuel Price

      • Petrol
      • Diesel
      Bangalore
      102.86/L0.00
      Chennai
      100.75/L-0.10
      Kolkata
      104.95/L0.00
      New Delhi
      94.72/L0.00

      Popular in News

        HomeMarketsPremiumInstant LoanMint Shorts