Chapter 8 of Finance Commission-XIII ( FC-XIII) made recomendations ( Dec'2009 ) on basis for tax sharing 32% of collection by Center with inter -se distribution of the states share amongst the states on the following criteria :
Criteria as below :
1. Population : 25% weight with 1971 Census
2. Area : 10%
3. Fiscal capacity Distance : 47.5%
4. Fiscial Discipline : 17.5%
With above logic, UP got 19.677% share followed by Bihar : 10.917%, West Bengal : 7.264%, Madhya Pradesh : 7.120%.
Bigger revenue / tax collection states having lower tax share by Center : Maharastra : 5.199%, Karnataka : 4.328%, Punjab : 1.389%, Andhra Pradesh : 6.937%, Gujarat : 3.041%, Tamil Nadu : 4.969%
Annexure : 7.6 and 7.7 shows which state generate more revenues as per below Finance report:
Now with Yesterday Finance Budget, lets look at how state wise distribution of net Proceeds of Union Taxes and Duties 2013-14
Here Bihar getting Rs 34493 Crore Central share, UP : 63974 Crore, WB : 23617, MP : 23148 Crore
MH : 16903, TN : 16155, AP : 22554, Karnataka : 14071
Details as per below report :
Some one can throw the light on these how states collecting more atxes are punished and other states getting lion share.