Dependence of States on Central Transfers: State-wise Analysis

C. Bhujanga Rao () and D.K. Srivastava ()
Additional contact information
C. Bhujanga Rao: National Institute of Public Finance and Policy
D.K. Srivastava: Madras School of Economics

Working Papers from National Institute of Public Finance and Policy

Abstract: This paper examines the dependence of states on central fiscal transfers. The pattern of dependence of states on central transfers is studied with respect to five groups of states, namely, high, middle and low income general category states and two groups of special category states categorized into high and low income states. We make a distinction between transfers that are in the form of an entitlement like states' share in central taxes or statutory grants vis-a-vis transfers that are discretionary and depend on centre's decisions. In terms of groups of states, the extent of dependence is relatively quite high for the special category states and the low income states. The extent of dependence was lowest during the period covered under the Tenth Finance Commission period. It has since increased, for all states considered together, by about 3.5 percentage points, from 37.4 percent to 40.9 percent of states' revenue receipts. This increase comes both from entitlement transfers and discretionary transfers to the extent of 2.1 and 1.3 percentage points, respectively.

Keywords: Central transfers; Tax devolution (search for similar items in EconPapers)
JEL-codes: H11 H77 (search for similar items in EconPapers)
Pages: 24
Date: 2014-05
New Economics Papers: this item is included in nep-pbe
Note: Working Paper 137, 2014
References: View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.nipfp.org.in/media/medialibrary/2014/05/WP_2014_137.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:npf:wpaper:14/137

Access Statistics for this paper

More papers in Working Papers from National Institute of Public Finance and Policy
Bibliographic data for series maintained by S.Siva Chidambaram ( this e-mail address is bad, please contact ).