Fair share

Dependence on cess and surcharge must come down

Recent years have seen growing tensions between the Union government and many state governments on the matter of the proper sharing of tax revenue. Some of this has been caused by the transition to goods and services tax (GST), which has reduced the space available to state governments to raise their own revenue. This has been exacerbated by the end of the GST compensation payments. It is essential that the guaranteed increases in state revenues under the GST bargain come to an end at some point so that states are incentivised to collect indirect taxes properly. Yet the broader argument