Stalin asks Finance Commission to recommend greater Central tax share for states, funds for disaster relief

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amil Nadu Chief Minister M.K. Stalin on Monday held discussions with the 16th Finance Commission Chairperson, Aravind Panagariya and members at the Secretariat here, and pitched for increasing the central tax share to the states, more funding for urban local bodies, and support for disaster relief.

Addressing the gathering, the Chief Minister said: "On behalf of Tamil Nadu and its people, I extend a warm welcome to the Chairman and esteemed members of the 16th Finance Commission. I firmly believe that the Commission’s recommendations should align with the expectations of all Indian states. These recommendations will play a crucial role in transforming India into a developed country while strengthening its federal structure.”

He also expressed concerns over the deteriorating financial situation in the state due to the increasing financial burden on state governments for implementing various schemes as he stressed the need to increase the central tax share allocated to states to 50 per cent, which, he argued, would enable states to implement developmental projects effectively.

The Chief Minister said that the reduction in the central tax share allocated to states and the continuous increase in the state’s financial contribution to centrally sponsored schemes - implemented jointly with the Union government - were the two primary reasons adversely affecting the financial health of Tamil Nadu.

He noted that while the Finance Commission had recommended increasing the central tax share for states to 41 per cent, the Union government had only provided 33.1 per cent in the past four years.

Stalin said that the frequent occurrence of natural disasters, the rising number of elderly citizens, and the financial and infrastructural demands of rapid urbanisation were three factors affecting the growth of Tamil Nadu.

Noting that Tamil Nadu has been severely affected by cyclones, torrential rains, and flooding, which have damaged lives, property, livelihoods, and infrastructure, he emphasised that significant funds are needed for relief and restoration efforts, which limits the state’s ability to allocate resources for developmental and welfare initiatives.

Stalin urged the Finance Commission to ensure adequate financial support for disaster relief and infrastructure restoration.

Additionally, he stressed the need to make investments in various sectors over the next decade to address the growing needs of the elderly population in the state.

He also requested the Finance Commission to recommend increased funding for urban local bodies, particularly in cities like Chennai, to meet the challenges of urban development and population growth.

The 16th Finance Commission, established under Article 280 of the Constitution, is responsible for determining the distribution of funds between the central and state governments.

✔️ Stalin asks Finance Commission to recommend greater Central tax share for states, funds for disaster relief

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