State Finances in India

Abstract

OF T'HE STUDY This is the final volume of a three-volume set exploring a range of issues relating to intergovernmental fiscal flows in India. This study attempts to evaluate the tax performance of particular states in terms of the average tax effort of all states. In addition to this aggregate measure, different taxes are examined to assess the intensity of use of various potential tax bases by the State governments, given their taxable capacity. The study covers the fifteen major states, over the period 1973-1976. Volumes I and II contain an overview of the principles of revenue sharing in India and a detailed examination of the implications of revenue sharing for project finance, respectively. Raja J. Chelliah and Narain Sinha were affiliated with the National Institute of Public Finance and Policy, New Delhi when this paper was prepared.