Why in News:

• Projections for indirect tax fluctuating, need to stabilize.

Background:

• The 15th Finance Commission on Thursday said that India’s GDP numbers suggest a continued high growth trend in the medium term even though they have fluctuated in the last few years.
• The Commission and its Members made these observations during a meeting with senior officials in the Ministry of Finance, including Finance Secretary Subhash Chandra Garg, Revenue Secretary Ajay Bhushan Pandey, Expenditure Secretary Girish Chandra Murmu, Chief Economic Adviser Krishnamurthy Subramanian, Central Board of Direct Taxes Chairman P.C. Mody, and Central Board of Indirect Taxes and Customs Chairman P.K. Das.
• “These discussions are credible to the ongoing work of the Commission to reach an appropriate conclusion on both the vertical and the horizontal devolution,” the statement added. “The Commission observed that the GDP numbers have somewhat fluctuated within the overall global trend, which suggests continued high growth trend over the medium term,” the statement added.
• “The Commission also made note of the revenue projections and said that although the direct tax collections and projections are healthy, the ones for indirect tax have been fluctuating and need to stabilise in a stronger position,” a senior official in the Finance.

Rationalising Schemes:

• The Commission and the Ministry also spoke about the expenditure side and how to rationalise the Centrally-sponsored schemes. The 15th Finance Commission has been holding detailed discussions with the Finance Ministry over the last few months to discuss the consequences of the Seventh Pay Commission and the Ujwal Discom Assurance Yojana (UDAY) on financial positions of the States.