Former Union Cabinet Secretary K.M. Chandrasekhar on Friday suggested that Kerala and other States place supplementary memorandums before the 16th Finance Commission urging it to take into account the impacts of the US tariff policies and proposed Goods and Services Tax (GST) revamp on their economies.
Mr. Chandrasekhar was making a special address at a round-table discussion organised by the Gulati Institute of Finance and Taxation (GIFT) and the Kerala State Planning Board on âThe impact of US penal tariff with a special focus on Kerala.â
The former Cabinet Secretary pointed out that these developments have emerged after the States submitted their initial memorandums to the Commission headed by Arvind Panagariya. But these are changed circumstances and States need to bring them to the notice of the Commission officially, he said.
âThe great confusion that has happened in the global markets as a result of the Trump tariffs also must go into the consideration of the Finance Commission. And now the new change (concerning GST) which I think is also part of the response of the Government of India to meet the crisis created by Trump also needs to be taken into consideration by the Commission,â he said.
Kerala had submitted its initial memorandum to the Commission when it visited the State in December 2024. Among other things, Kerala had urged the Commission to raise the share of States in the divisible tax pool from 41% to 50% and rework the formula used for resource sharing among States, besides an increased allocation for disaster management.
The 16th Finance Commission is required to submit its recommendations on the sharing of tax revenues between the Union and States for the five-year period from April 1, 2026, by October 31 this year.
Published â August 22, 2025 05:08 pm IST
