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Finance Commission report: States' borrowing window, health spending & more States will receive Rs 10.33 trillion in grants
States to get Rs 10.33 trillion in grants States will receive Rs 10.33 trillion in grants. This will make aggregate transfers to the states at Rs 52.53 trillion, roughly at 50 per cent of the total divisible pool in the next five years Devolution to states kept intact In order to maintain predictability and stability of resources during the pandemic, the tax devolution to states was retained at 41 per cent of the divisible tax pool. This will amount to Rs 42.2 trillion for the next five years. However, the Centre imposed agriculture infra cess on certain items, including petrol, diesel, gold, and some imported agricultural products, while reducing tax rates to make it neutral Concerns of southern states addressed Commission was sensitive to the concerns raised by southern states overtaking 2011 census into consideration. As such, it gave 12.5 per cent weightage to demographic performance in the devolution. The population has been given 15 per cent weightage Fiscal consolidation road map of 4% by FY26 The Finance Commission recommended that the Centre brings down its fiscal deficit to 4 per cent of GDP by 2025-26 against 6.8 per cent in FY22. The government has accepted the recommendation with an escape clause of 0.5 percentage points for the terminal year. For states, it recommended a fiscal deficit at 4 per cent of GSDP, 3.5 per cent in the following year and 3 per cent for the next three years