Center and UP's interest in tax must be 50-50, the demands of the Yogi government of the Finance Commission

In a meeting with the 16th Finance Commission team on Wednesday, the state government demanded to increase the stake in central tax from 41 percent to 50 percent. In addition, the state government also submitted a memorandum to the commission regarding the raising of special funds for special development schemes and other claims. The chairman of the commission, Arind Panagariya, said 22 out of 28 states proposed to increase the stake in central taxes to 50 percent, but the additional demand of 9 percent is very large. The final decision on this will be made later. At the meeting, the state government gave details about the steps taken for the development and reform of the state, which was appreciated by the commission. Chief Minister Yogi Adityanath held a meeting with the 13 -member team of the Commission in Lok Bhavan and presented the details of the state’s needs and claims in detail. Currently, states get 41 percent in central taxes, while the center holds 59 percent. Now states have demanded equality in central taxes. Panagariya did not confirm whether the commission would include this proposal in its final recommendations. However, he said that the central government had accepted the recommendations of the previous financing commissions in general without any change. The chairman of the commission said that the needs of UP are more than a large state. The state has made very good progress. The state government has better dissolved revenue -related problems. This increased its tax resources. State tax, VAT and excise increase are good signs. The fiscal deficit is also about three percent. In the afternoon, the Financing Commission team met representatives from various political parties, urban and rural bodies and representatives related to business. Panagariya said the state also demanded a change in the tax section formula to change the tax distribution formula. It is claimed that the measurement of the burden of income difference measured by GDP per capita GDP (GSDP) as previously held at 45 percent. The geographical area is claimed to be reduced from 15 percent to 10 percent. The commission proposed to increase the part of the population of 15 to 22.5 percent, demographics from 12.5 to 7.5 percent, the forest area of ​​10 to 5 percent and a share in the name of tax efforts of 2.5 to 10 percent. This is the responsibility of the 16th Finance Commission, the 16th Finance Commission was established on 31 December 2023. The responsibility of this commission is the distribution of tax revenue between the center and the states. The commission can submit its report by October 31. These recommendations are in effect from 1 April 2026-27 to 2030-31. Share this story -tags