Artha Vijnana: Journal of The Gokhale Institute of Politics and Economics

Anita Rath ¹

Affiliations
1 Centre for Study of Developing Economies, School of Development Studies, Tata Institute of Social Sciences, Deonar, Sion-Trombay Road, Mumbai 400088, IN

Abstract

Finance Commissions (FCs), since eight FCs, have been using 1971 population figures of states, instead of current ones, in the dispensation of central funds to support the cause of population control. This policy has been regressive and is at odd with the core objective of FC transfers as crucial resources are withheld mainly from least developed Empowered Action Group (EAG) states. Contemporary demographic realities warrant reforms on this front. This paper re-estimates the inter se shares of states for the Thirteenth and Fourteenth FC award periods to find the impact of dated population figures on such transfers. The presidential order for fourteenth FC, unlike previous ones, permitted a change in this policy. Fourteenth FC introduced current population figures only as a part of population as an independent factor along with old figures. It is a symbolic move heralding a departure from the status quo sans any major impact.

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Anita Rath ¹

Affiliations
1 Centre for Development Studies, Tata Institute of Social Sciences, Deonar, Mumbai 400088, Maharashtra, IN

Abstract

This paper explores the direction and extent of vertical inequity in the taxation of residential properties in Greater Mumbai. Based on the data from a representative sample of properties from the city and suburbs, it employs multiple econometric tools to explore the problem. Findings of the study indicate that the system is iniquitous and regressive. There is a significant disparity in the effective tax burden between the main city and suburban properties, and separate treatments are also accorded to high and low end properties. Such studies can be replicated in other contexts where property tax systems are alleged to be iniquitous.

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