State deprived of revenue, Union govt should reduce taxes: PTR

CHENNAI: State Finance Minister Palanivel Thiaga Rajan on Tuesday in his reply to Union Finance Minister Nirmala Sitharaman said that already the State governments are deprived of their revenues and only the Union government should come forward to reduce taxes.

"After the introduction of GST, the State’s power to levy taxes has been reduced greatly. There are not enough avenues for the State to augment its revenues. Therefore, it is the Union Government which has the opportunities and resources to help the common man and I request the Union Government to come forward and reduce its taxes,” said Palanivel Thiaga Rajan, in a statement.

He also said that the State's share in the national population is 6.21 % and it’s share in the GDP is 9.16%, but the State gets only 4.079% as devolution from Central taxes.

"Tamil Nadu did not get its due share in successive Finance commissions and the share for the State has continually decreased,” said PTR.

The Union Finance Minister stated that the Tamil Nadu government did not reduce the taxes on petrol and diesel while the Union Government had reduced their taxes while speaking about the issue of price rise in the Parliament, on Monday. Palanivel Thiaga Rajan said that even before the Union government had first reduced its taxes on petrol and diesel in November 2021, the State government had cut the VAT on petrol by Rs. 3 per litre in August, last year.

Further, reduction of taxes by the Union government on petrol has reduced the State taxes by Rs. 1.95 per litre which took the entire tally on petrol reduction to a total of Rs. 4.95 per litre. Similarly, reduction of taxes by the Union government on diesel has reduced the State taxes by Rs. 1.76 per litre.