Finance Commission chairman NK Singh Thursday said finance minister Nirmala Sitharaman has reacted "positively" to the request, adding the same plea was also made to her predecessor Arun Jaitley. Given the impact of its tax reviews on the states' revenue receipts, the 15th Finance Commission has sought regular dialogues with the GST Council, the national body deciding on the indirect taxes.

"We hope that the commission will soon interact with the GST Council and establish a dialogue mechanism besides taking steps on the outcome of GST, which affects the commission, the Centre and more so the states," he told reporters here. Singh said though the GST Council, which is an autonomous constitutional body, does not have any direct link to the finance commission, the panel will have to include the outcome of GST Council's decisions in its data for the revenue calculations and projections. Replying to a question about demand by several states to increase the allocation to 50 percent from current 42 per cent, Singh said, "no state has so far abstained from asking for an increase from 42 percent to 50 percent, and the Centre at no stage will be happy with such a high level. We have to make a judicious balance."

On the demand of the MP Congress leaders to compensate the farm-loan waiver introduced by the state government, he said the Centre has left to individual state's fiscal health. Earlier in the day, the commission held meeting with chief minister Kamal Nath and state officials. Nath has appealed the commission to think about inter-state equality going beyond the Centre-state relationship. A public relations officer said, "Nath told the commission that the method of tax revenue sharing needs to be re-looked. If it does not happen then the disparities between the states will rise," and called for sharing the cesses and surcharges collected by the Centre with the states. ?

Source:news18