Northeastern states demand increased share of central taxes

September 20th, 2008 - 5:37 pm ICT by IANS  

Agartala, Sep 20 (IANS) The northeastern states have urged the finance commission to double their share in the funds from the central taxes to 10 percent, a senior Tripura minister said. “The northeastern states as per recommendations of the 12th finance commission has been getting 5.437 percent of the share of central taxes and we have proposed the tax share be increased to 10 percent,” Tripura Finance Minister Badal Chowdhury said.

Finance ministers and secretaries of the northeastern states met the chairman of the newly constituted 13th finance commission Vijay L. Kelkar in New Delhi earlier this week and made this demand.

The term of the 12th finance commission headed by C. Rangarajan expires October next year and the 13th finance commission would start work soon to make recommendations relating to the distribution of the net proceeds of taxes between the centre and the states.

“The 10 special category states, including the eight northeastern states have also demanded funds under the gap grant to meet the states’ burden to bear the additional liabilities of pay commissions for the government employees,” Chowdhury said.

The finance ministers also made a strong plea to reduce the number of centrally sponsored schemes (CSS), saying such projects were not practical for the states due to a number of terms and conditions. At present, more than 200 CSS are operational across the country.

“In the interest of the regional balance, a prioritised attention should be given to the problems of northeastern states as well as the special category states,” said a memorandum submitted before the finance commission chairman by the finance ministers of the region.

“Cent percent additional financial burden of the special category states, including the eight northeastern states as a consequence of the centre’s decision on sixth central pay commission should be shared by the centre,” it added.

The finance ministers have submitted 18 specific proposals on restructuring of centre-state financial relations.

The revenue base of the northeastern states, which belongs to the special category states, are very poor for various reasons, including absence of big industry, corporate house, besides a large number of poor people, Chowdhury said.

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