Premium

Odisha joins Kerala, Tamil Nadu and Gujarat to seek 50% share in Central taxes

It also demanded inclusion of cess and surcharge in divisible pool so states can have their share in it.

Odisha Chief Minister Mohan Charan Majhi. (Photo: Mohan Charan Majhi/X)

Odisha Thursday demanded an increase in states’ share of central taxes to 50 per cent from the existing 41 per cent. Odisha, which has sought Rs 12.59 lakh crore in central taxes for the period 2026-31, joins states such as Gujarat and Tamil Nadu in making the demand.

CM Mohan Charan Majhi, along with senior officers, met the finance commission headed by Arvind Panagariya to seek an increase in its share in central taxes to 4.96 percent from the current 4.52 percent recommended by the previous finance commission. It also demanded inclusion of cess and surcharge in divisible pool so states can have their share in it.

“Overuse of cess and surcharges need to be contained, and the 16th Finance Commission may consider suggesting stricter tests for the cess and surcharges to qualify for exclusion from the divisible pool, through a constitutional amendment, if necessary,” a memorandum presented by the state government before the commission said.

Story continues below this ad

The finance commission headed by Panagariya is currently on a four-day visit to Odisha as part of its visit to various states. According to Panagariya, states such as Kerala, Gujarat, Tamil Nadu, Punjab and Goa have suggested an increase in the states’ share in central taxes to 50%.

According to the memorandum, Odisha suggested that a modified population variable – such as the share of vulnerable population including SC and ST, and those requiring special attention like people above 80 years of age and widows without any support — should be used in the tax devolution formula instead of the entire population.

Stay updated with the latest - Click here to follow us on Instagram