Karnataka CM meets Sitharaman, seeks pro-growth tax devolution from 16th Finance Commission
New Delhi, Jun 24 (PTI): Karnataka Chief Minister Siddaramaiah on Tuesday met Union Finance Minister Nirmala Sitharaman to seek the Centre's support for a pro-growth approach in tax devolution among states by the 16th Finance Commission.
During the meeting, Siddaramaiah briefed Sitharaman on Karnataka's significant losses under the 15th Finance Commission award and demanded a larger allocation for the state from the central tax pool under the 16th Finance Commission starting April 1, 2026.
"I met the Union Finance Minister and informed that Karnataka faced a cumulative loss of over Rs 80,000 crore due reduction in the state's share of tax devolution by the 15th Finance Commission," Siddaramaiah told reporters after the meeting.
The CM submitted an additional memorandum and urged the Centre to rectify a persistent imbalance in fiscal transfers from the Centre to states.
Under the 15th Finance Commission, the state's share in tax devolution declined from 4.713 per cent to 3.647 per cent -- a reduction of over 23 per cent. Karnataka was also denied Rs 11,495 crore in special grants, resulting in a total loss of Rs 80,000 crore during the award period.
The chief minister attributed this decline primarily to the over-reliance on the income-distance criterion, which received 45 per cent weightage under the 15th Finance Commission.
Karnataka has requested the 16th Finance Commission to reduce the weightage for income-distance by 20 percentage points and reallocate it to fiscal contribution -- the state's share in national GDP.
The state has also proposed discontinuing Revenue Deficit Grants in their current format, arguing they contradict fiscal discipline principles outlined in the FRBM framework. Instead, Karnataka suggested redistributing the same amount -- 1.92 per cent of Gross Union Receipts under the 15th Finance Commission -- among all states using the horizontal devolution formula.
Siddaramaiah highlighted the developmental challenges facing Bengaluru, Kalyana Karnataka and Malenadu regions, emphasising that fair and pro-growth devolution would accelerate the state's growth trajectory.
The chief minister clarified that Karnataka's proposals were not a request for special treatment but would improve overall national resource mobilisation and foster cooperative and competitive federalism.
The meeting concluded with Siddaramaiah requesting the finance minister to include these proposals in the Union government's memorandum to the 16th Finance Commission, arguing that growth-friendly devolution would empower all states to contribute effectively to India's development journey.
The Finance Commission gives suggestions on financial relationship between the Centre and states.
The 16th Finance Commission, set up in December 2023 under the chairmanship of Arvind Panagariya, is expected to give its recommendations by October 31, 2025, which will be applicable for a five-year period beginning April 1, 2026.
The 15th Finance Commission headed by N K Singh had suggested that states be given 41 per cent of the divisible tax pool of the Centre for a five-year period from April 2021 to March 2026.
Met Union Finance Minister Smt. @nsitharaman today and urged the Govt of India to ensure a pro-growth and fair tax devolution by the 16th Finance Commission.
— Siddaramaiah (@siddaramaiah) June 24, 2025
Karnataka’s share was slashed from 4.713% to 3.647% under the 15th FC - resulting in a loss of ₹80,000 crore.
I’ve… pic.twitter.com/wV5MF0K6Ej
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40 Palestinians killed in Gaza as Netanyahu, Trump meet over ceasefire
Deir al-Balah (Gaza Strip), Jul 9 (AP): At least 40 Palestinians were killed in Israeli airstrikes in the Gaza Strip, hospital officials said Wednesday, as international mediators raced to complete a ceasefire deal.
Israeli Prime Minister Benjamin Netanyahu had a second meeting in two days with US President Donald Trump at the White House on Tuesday evening. Trump has been pushing for a ceasefire that might lead to an end to the 21-month war in Gaza. Israel and Hamas are considering a new US-backed ceasefire proposal that would pause the war, free Israeli hostages and send much-needed aid into Gaza.
Nasser Hospital in the southern city of Khan Younis said the dead included included 17 women and 10 children. It said one strike killed 10 people from the same family, including three children.
The Israeli military did not comment on specific strikes, but said it had struck more than 100 targets across Gaza over the past day, including Hamas members, booby-trapped structures, weapons storage facilities, missile launchers and tunnels. Israel accuses Hamas of hiding weapons and fighters among civilians.
