Karnataka's Call for Fair Tax Devolution: A Pro-Growth Appeal to the 16th Finance Commission

Karnataka Chief Minister Siddaramaiah on Tuesday urged the Union Finance Minister Nirmala Sitharaman to address imbalances in tax devolution among states as part of the upcoming 16th Finance Commission's recommendations. The plea comes in the wake of significant fiscal setbacks under the previous commission.

During their meeting, Siddaramaiah emphasized Karnataka's Rs 80,000 crore losses due to the reduced share from central tax devolution. He proposed a restructured approach to fiscal allocations, highlighting the diminished weight given to the income-distance criterion, and advocated a fairer share based on the state's GDP contribution.

This appeal is not special pleading but seeks to enhance national resource mobilisation and federal cooperation. Siddaramaiah underlined that rectifying fiscal disparities will empower Karnataka and all states to significantly contribute to India's growth narrative.