Govt to have new criteria for sp status, Nitish claims victory

Feb 28, 2013, 09.02 PM IST

Govt to have new criteria for sp status, Nitish claims victory

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New Delhi/Patna, Feb 28 (PTI) Amid demands from states like Bihar to revise existing yardsticks for granting special status to backward states, Centre today proposed to evolve a new criteria that would reflect in future planning and devolution of funds to the states. Welcoming the announcement, Chief Minister Nitish Kumar said in Patna it was a 'victory in-principle' for Bihar in view of its consistent demand for grant of such a status. In his budget speech, Chidambaram said, "the present criteria for determining backwardness are based on terrain, density of population and length of international borders. "It may be more relevant to use a measure like the distance of the state from the national average under criteria such as per capita income, literacy and other human development indicators. I propose to evolve new criteria and reflect them in future planning and devolution of funds". The announcement comes at a time when the UPA is on the look out for new allies and sees a potential friend in Nitish Kumar in case the BJP projects Narendra Modi as its face for the next Lok Sabha elections. The antipathy between Kumar and Modi is well-known. Kumar's party had plans to address a rally in New Delhi on March 17 on the issue. Bihar government has been consistent in its demand for changing the criteria for determining backwardness of a state so that it could get special status. Kumar told reporters in Patna "we have been demanding review of the criteria for special status to the states for a long time and framing of new criterion for grant of such a status to backward states like Bihar....I am glad that Chidambaram has referred to revisiting criteria for special status during his budget speech". The Chief Minister, however, ruled out a political meaning of his lavish praise for the Finance Minister and said that no such conjecture should be made as the Centre's commitment to revisit the special status. A Congress leader speaking on the condition of anonymity pointed out that Bihar has got "huge funds in the budget." Special category status attracts investment in a state as investors get tax benefits. In 1969 while devising formula for sharing central assistance among states, the Fifth Finance Commission acting in line to the Gadgil formula, had accorded special status to three states on the basis of harsh terrain, backwardness and social problems prevailing in these states. The number later rose to 11. The states which have been granted special category status include Arunachal Pradesh, Assam, Himachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Sikkin, Tripura and Uttarakhand. PTI AMR KDK RT

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highlights

No case to revise direct tax rates, slabs
Super rich tax: 10% surcharge on income above Rs 1 cr
Increase excise duty on SUV's from 27% to 30%
No change in standard rate of excise duty, service tax

flashes

Budget Reaction: Fitch Says Policy Implementation To Be Key Driver Of India Rating
Budget Reaction: Fitch Says Believe Policy Execution Will Be Challenging
Budget Reaction: Fitch Says Public Finances Vulnerable To Further Growth Slowdown
Budget Reaction: Fitch Says Commitment To Fisc Cons, Despite Poll, Encouraging

GAAR-Presumes tax benefit unless proved contrary
MFs covered for deductions u/s 80CCG
Excise duty increased on mobile phones of Retail Sale Price (RSP) more than Rs 2000
ED on readymade garments exempted: positive textile sector

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18:52 pm

Exice Duty on readymade garments exempted +ve for textile sector

TAX AND YOU

Retired Person

Sanjay Matai

REACTIONS

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reaction on: Markets

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reaction on: Business

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