DELHI: Indian Commerce Minister, Nirmala Sitharaman, said that central government has decided to provide greater tax revenue share to states as a sign of “cooperative federalism” and this step would allow states greater freedom to spend as per their needs.
“Also the fact that we are putting all energy in getting the GST through and with devolution happening to the states [they will achieve greater fiscal autonomy],” she told CNBC-TV18 in an exclusive interaction.
The recommendations of the 14th Finance Commission has actually caught the letter and spirit of what the Prime Minister has been saying. Also the fact that we put all the energy in getting the GST through, so, from that point of view if all over the country there is going to be one large taxation system – the GST and if the devolution has to happen to the states with the collection being under GST it is only fair that the formulation is worked out nicely, clearly.
Keeping in consistency with the government of India and the Prime Minister’s own commitment to form a cooperative federalism and talking of Team India, to have resources given to the states without tying them to certain descriptions and to give them larger chunk of the collection itself speaks of the cooperative federalism that we want to implement. Since the recommendations are in line with the kind of belief and the commitment of this government, the government has immediately accepted it and accepted these recommendations. Very clearly the Finance Minister said what it is going to mean in terms state receipts.
