The Congress in Maharashtra Tuesday told the 15th Finance Commission Mumbai should be given special grants for infrastructure development and asked it to consider transferring additional tax revenue to its civic body.
A delegation of the Maharashtra Pradesh Congress Committee (MPCC) submitted a written memorandum in this regard to the commission, headed by chairman N K Singh, which is in Mumbai for consultations.
The MPCC delegation, led by its vice-president Ratnakar Mahajan, said the Municipal Corporation of Greater Mumbai (MCGM) should be given special grants for development of infrastructure such as roads, bridges, flyovers, drainage system and public transport.
“Urban local bodies are now becoming behemoth, especially the Municipal Corporation of Greater Mumbai. We request that considering the special position Mumbai holds in the country, the MCGM be transferred a certain percentage of divisible pool of taxes over and above the share of the state,” the memorandum said.
Mumbai collects more than Rs 3.14 lakh crore of direct taxes in the country. The ever-increasing population and inadequacy of infrastructure has clogged the city, it said.
The divisible pool is that portion of gross tax revenue which is distributed between the Centre and the states.
The opposition party said it feels that the Central government, in order to fulfil its commitments of certain goals by 2022, may slash funds for Maharashtra by increasing central spend on state schemes.
Maharashtra is “No. 1” state in GST collection. It has recorded 28 per cent rise in 2017-18. The debt burden of the state is Rs 4.61 lakh crore while fiscal deficit is Rs 50,586 crore. Hence, Maharashtra should be entitled for revenue deficit grants, the party said in the memorandum.
The party criticised the Terms of Reference (ToR) of the commission.
By suggesting that the impact of the “generous devolution by the 14 th Finance Commission be reviewed, the terms of reference have clearly indicated that the tax devolution to the states to meet requirements of the central schemes will be reduced. This goes against the spirit of federalism,” it said.
The party urged the commission to consider devising certain methods to incentivise better performing states like Maharashtra.
The Finance Commission is set up every five years to decide the sharing of tax resources between the Centre and states.
The 15th finance panel is headed by N K Singh, a retired IAS officer.