Maha Demands 50% Share Of Tax Pool

Maharashtra has joined the growing demand for an increase in the state's share of the divisible tax pool, to 50%, from the current 41%.

- Faisal Malik

MUMBAI: A memorandum of demands was presented to the 16th Finance Commission by chief minister Devendra Fadnavis at a meeting in Mumbai on Thursday. During its presentation, the state said performing states deserve a higher allocation from the divisible pool.

The demand is on the lines of Gujarat, Haryana, Tamil Nadu, Karnataka, Telangana, Kerala and Odisha, among others, said Arvind Panagariya, chairperson of the commission.

The divisible tax pool comprises taxes collected by the central government and shared between the centre and the states. Surcharges and cesses are not part of the pool.

Maharashtra has also demanded special grants worth ₹1.28 lakh crore for six projects. These include developing the Mumbai Metropolitan Region (MMR) as a growth hub, interlinking of rivers, strengthening prison infrastructure, hostels for post-graduate medical students, construction of a new Bombay high court complex in Bandra, and promoting eco-tourism in Maharashtra.

"On vertical devolution of funds, the state government suggested an increase in the state's share, from the current 41% to 50%, a demand made by most other states... It was emphasised that performance ought to be given greater importance than in the past," Panagariya said.