Maharashtra Asks for 50% Share of Central Taxes
Maharashtra Wants More From the Centre
The Maharashtra government is making a big ask: it wants a bigger share of the pie when it comes to central taxes. On Thursday, they formally requested a 50% share in what’s known as the ‘divisible tax pool,’ up from the current 41%.
This demand was made during a meeting with the 16th Finance Commission, a body that decides how taxes are divided between the central government and states. Chief Minister Devendra Fadnavis, along with his deputies Ajit Pawar and Eknath Shinde, presented their case to the Commission.
More Than Just a Bigger Slice
Maharashtra’s proposal isn’t just about a simple percentage increase. They’re also pushing for some changes in how taxes are calculated and distributed. For example, they want to combine ‘cesses and surcharges’ (additional taxes) with the main taxes, and include non-tax revenue from the Union government in the pool.
The state also wants the Commission to consider new criteria for distributing funds among the states. They suggest factors like ‘Sustainable Development and Green Energy’ and ‘Incremental Contribution by States to India’s GDP’ should be taken into account.
Focusing on Development
Maharashtra emphasized the need for increased funding for mega projects, including the implementation of an economic master plan for the Mumbai Metropolitan Region (MMR), river linking projects, and infrastructure improvements for high courts, prisons, and medical student hostels.
They also requested a boost to the State Disaster Response Fund (SDRF) and a change in the sharing ratio with the Centre from the current 75:25 to 90:10.
Lastly, Maharashtra wants to see a rise in grant-in-aid for local bodies, from the current 4.23% to 5% of the divisible pool. These funds would be used to improve public bus transport and fire service systems in urban areas.
A State with a Vision
The Finance Commission chairman praised Maharashtra for its financial responsibility and its significant contribution to India’s economic growth.
