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16th Finance Commission Signals Support for 25% Tax Devolution Boost for Northeast States

Members of the finance panel recognized the Northeast’s structural hurdles, pledging thorough examination of the four-state memorandum before issuing final recommendations.

Overview

  • A delegation led by Meghalaya Chief Minister Conrad K Sangma formally requested at least a 25% increase in central tax devolution and a dedicated infrastructure fund for smaller Northeast states.
  • Commission Chairman Dr Arvind Panagariya and members welcomed the memorandum, acknowledging the region’s difficult terrain, infrastructure gaps and limited revenue-generation capacity.
  • Panel members assured the submissions from Mizoram, Tripura, Sikkim and Meghalaya will be carefully reviewed as they prepare their final report.
  • State leaders highlighted that a 20% rise in devolution under the 15th commission had doubled capital spending, driving gains in health, tourism and infrastructure.
  • Delegates also urged greater autonomy and more flexible central schemes to allow tailored investment in roads, healthcare, education and tourism.