M Govinda Rao quoted in the Financial Express on CAG audit

M Govinda Rao, Councillor of Takshashila Institution was quoted in the Financial Express on the CAG report showing shortfall in transfer of cess funds by the Union Government. He was quoted as saying:

“So long as the Centre has the authority to levy cesses, it may choose to levy a fresh cess. While some of the cess funds are shared with states for specific schemes and activities, the special excise duty on petroleum is solely used by the Centre and not given to states,” noted M Govinda Rao, councillor, Takshashila Institution, adding that the GST Compensation cess should not even be considered as part of the overall cess and surcharges as the money goes to the states.

Rao, who was a member of the 14th Finance Commission, noted that previous Finance Commissions have also adversely commented on this issue. While the number of cesses and surcharges has been rationalised by the Centre over the years, revenue raised through these cesses and surcharges has grown steadily over the last few years, and often at a faster pace than gross tax revenue.

Read the full report here.