Goa Seeks Enhanced Share in Vertical Tax Devolution, State-Specific Funds
Panaji, January 9, 2025: The Goa government has made a strong pitch to the 16th Finance Commission, seeking a significant increase in its share of vertical tax devolution from 41% to 50%. This proposal, if accepted, would result in a fourfold increase in Goa’s share of the devolution pool, according to Dr. Arvind Panagariya, Chairman of the 16th Finance Commission.
Additionally, the state government has demanded Rs 32,700 crores for 13 projects as state-specific funds. This move is aimed at addressing Goa’s specific development needs and priorities.
The demand for a higher share in vertical tax devolution is not unique to Goa, as many states have been seeking a greater share of central taxes to address their fiscal needs ¹. The 14th Finance Commission had recommended a 42% devolution, which was later revised to 41% by the 15th Finance Commission.
The 16th Finance Commission, headed by Dr. Panagariya, is mandated to review the state of finances of the Union and state governments and make recommendations on the distribution of taxes and duties between them.
The commission’s recommendations will have significant implications for Goa’s finances and development priorities. If accepted, the proposed increase in vertical tax devolution and state-specific funds would provide a substantial boost to Goa’s fiscal resources, enabling the state to address its development needs more effectively.
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