CHENNAI: Following reports in a section of the media that the Union government is mulling to cut central tax revenues shared to the states from 41% to 40%, Finance Minister Thangam Thennarasu on Friday strongly condemned the move.
The minister, in his post on X, pointed out while Tamil Nadu already receives less than what it deserves, there are now reports that the finance commission is likely to recommend cutting states’ share further from 41% to 40% as suggested by the Union government. “Is this how performing states are rewarded?” he questioned.
Stating that the Union government must act fairly, the minister reiterated Tamil Nadu’s demand for 50% devolution of central taxes. “Pertinent to mention that many other states have also supported it,” he said.
Meanwhile, PMK founder S Ramadoss, in a statement, said due to the reported move of the central government, the revenue share to the states might go down by more than Rs 35,000 crore. “This decision of the centre which goes against the interests of the states is condemnable,” Ramadoss added.
He said although Tamil Nadu is one of the states which pay higher tax revenue to the centre, the revenue share from the centre has been very low. “At a time when various political parties are demanding that the revenue from the centre should be hiked from 41% to 50%, reducing it to 40% is unfair. The centre should give up this move and even if the central government proposes such a reduction, the Finance Commission should not accept it,” he added.