Assam CM's Plea on Tax Devolution: A Critical Discussion with Finance Commission

During a meeting with the 16th Finance Commission, Assam Chief Minister Himanta Biswa Sarma voiced concerns over the declining trend in tax devolution for the state. He emphasized that reduced taxes in neighboring states are resulting in revenue losses for Assam. The state proposed various measures, including a new criterion of 'multi-dimensional poverty' for fund allocation.

During a pivotal meeting, Chairman of the 16th Finance Commission, Arvind Panagariya, addressed concerns relayed by Assam Chief Minister Himanta Biswa Sarma regarding the declining trend of tax devolution in the state. Sarma noted that the trend has been prevalent since the 13th Finance Commission.

The Chief Minister cited lower taxes on petroleum products and liquor in neighboring states as key factors contributing to Assam's revenue loss, for which he proposed different criteria for tax devolution. The Assam government recommended reducing the state's share from 15% to 10% and introducing a 'multi-dimensional poverty' criterion for a 5% allocation.

Additionally, Sarma advocated for a higher allocation for disaster relief funds, emphasizing the prolonged time taken for rebuilding post-disasters. The 16th Finance Commission acknowledged these points and will review them further. The Commission is currently on a four-day tour in Assam, engaging with various stakeholders on monetary issues.

(With inputs from agencies.)