Bhubaneswar: Many states have demanded enhancement of their share from the existing 41 per cent to 50 per cent from the central divisible pool, 16th Finance Commission chairman Aravind Panagariya said here Thursday.
Several states also wanted a portion of the cess and surcharge being imposed by the central government, he said.
The divisible pool is that portion of gross tax revenue which is distributed between the Centre and the States. Surcharges and cess are not part of the pool.
“The commission has visited several states and held consultations. Maximum states demanded an increase in the share in the central pool to 50 per cent. Only one or two states have demanded a 45 per cent rise,” Panagariya said.
Panagariya was talking to reporters after a discussion with Odisha Chief Minister Mohan Charan Majhi. The commission is on a four-day visit to the state.
He said that the Odisha government is also in favour of making cess and surcharges collected by the Union Government a part of the divisible pool for distribution among the states.
On the demand for Special Category status for the natural calamity-prone Odisha, he said the subject is not coming under the purview of the Finance Commission.
Earlier, the Planning Commission used to provide such status but NITI Aayog came into its place and no state has got the tag, he said.
Panagariya said, “The central government is imposing cess and surcharges and 100 per cent of those funds directly go to the budget of the Centre. But, the Odisha government demanded that the cess and surcharges be brought to the divisible pool so that states can also get a share.”
The Odisha government has also raised its demand for revising the weightage fixed under different criteria while distributing the divisible pool funds among the states, he said.
Meanwhile, in a memorandum to the 16th Finance Commission, Opposition BJD president and former chief minister Naveen Patnaik said, “Due to the perpetual neglect by successive Governments at the Centre, Odisha has not been provided its rightful share in Central Divisible Pool of Taxes compared to the revenue collected from the State.”
Odisha has lost out on funds and was deprived of the resources which would have helped the state and its people to grow faster and more sustainably, Patnaik said adding that his party would like to fight for the rights of the people of the state.
“We would like to bring forth the broad issues that have not only reduced net central transfers to the states over the years but also eroded financial autonomy of states in several ways,” Patnaik said.
Earlier, Chief Minister Mohan Charan Majhi submitted a memorandum with the 16th Finance Commission demanding Rs 12,59,148 crore for the state from 2026 to 2031.
PTI
