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Horizontal Devolution of States in India-Suggestions Before the Fourteenth Finance Commission

Author

Listed:
  • R. Mohan
  • N. Ramalingam
  • D. Shyjan

Abstract

The focus of the paper is to suggest an alternate methodology for horizontal devolution from divisible pool of Central taxes and disbursement of grants. Tax devolution criteria suggested are population and gap of per capita own tax revenue of a State from the average of highest three States worked on a normative basis. Methodology for normatively estimating expenditure requirements of States are also attempted in this paper. It is suggested that for grant disbursement, the Finance Commissions need to become the prime agency.

Suggested Citation

  • R. Mohan & N. Ramalingam & D. Shyjan, 2014. "Horizontal Devolution of States in India-Suggestions Before the Fourteenth Finance Commission," Working Papers id:5965, eSocialSciences.
    • Handle: RePEc:ess:wpaper:id:5965
    Note: Institutional Papers
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    References listed on IDEAS

    as
    1. Pinaki Chakraborty & Bharatee Bhusana Dash, 2017. "Fiscal Reforms, Fiscal Rule, and Development Spending: How Indian States Have Performed?," Public Budgeting & Finance, Wiley Blackwell, vol. 37(4), pages 111-133, December.
    2. C. Rangarajan & D. K. Srivastava, 2008. "Reforming India’s Fiscal Transfer System : Resolving Vertical and Horizontal Imbalances," Finance Working Papers 22509, East Asian Bureau of Economic Research.
    3. C. Rangarajan & D. K. Srivastava, 2008. "Reforming India’S Fiscal Transfer System: Resolving Vertical And Horizontal Imbalances," Working Papers 2008-031, Madras School of Economics,Chennai,India.
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