THE HINDU Editorial Vocabulary- December 6, 2017- Topic 1
New India formula? — on the 15th Finance
Commission
The Centre has moved swiftly
to notify the presidential order setting up the Fifteenth Finance Commission,
within five days of the Cabinet’s approval. The constitutional body is tasked
with recommending a fiscal road map and a sharing of resources between the
Centre and the States.
On Monday, former Revenue Secretary N.K. Singh, who has
been appointed chairman of the Commission, held preliminary discussions on its
“wide-ranging” terms of reference and decided to hold expeditious consultations
with stakeholders at all administrative levels as well as with political
parties. Think tanks and academics will be consulted. The Commission has less
than two years to complete its deliberations and submit its report by October
2019, giving the government a little over a quarter to consider and implement
its recommendations for the period from April 2020 to March 2025. Accepting the
14th Finance Commission’s recommendation to raise the States’ share in the
divisible pool of taxes to 42% from the previous 32% level, Prime Minister
Narendra Modi had told Chief Ministers that although this meant less money at
the Centre’s disposal, his government had decided to strengthen the States’
capacity to move away from a ‘one-size-fits-all’ approach. While Mr. Modi’s
disdain for Central planning is well-known, the terms of reference for this
Commission seem to suggest that the record hike in the tax transfer rate to
States is pinching.
The Centre has urged the
Commission to finalise its tax-devolution formula after factoring in the impact
on the Union’s fiscal situation, keeping in mind “the continuing imperative of
the national development programme including New India – 2022”. Taken together
with its need for resources for essential spending in areas such as defence,
security, infrastructure and climate change, the Centre seems to be seeking a
rollback of the 42% share for States. The government’s top brass has repeatedly
asserted the need for revenue to maintain public spending in the face of flak
for high petroleum taxes. But a reduction from the 42% rate could dent States’
faith in the Centre’s claims of cooperative federalism. The rollout of the
goods and services tax, which marks a new chapter in tax administration with
both the Centre and States working together through the GST Council, makes the
challenge trickier. The Centre is committed to compensating States for any
revenue losses arising out of GST implementation till June 2022, thus covering
nearly half the period for which the Commission is to recommend a formula. Its
mandate includes formulating performance-linked incentives for States on a
range of desirable outcomes such as attaining a replacement rate in population
growth, deepening the GST net and improving the ease of doing business.
Devising a fiscal nudge for development goals sounds attractive, though the
challenge would lie in quantifying the good from the ugly — especially when one
has to reward a State for showing ‘control or lack of it in incurring
expenditure on populist measures’.
Vocabulary
Recommend: put forward someone or
something with approval as being suitable for a particular purpose or role.
Example: George had recommended some
local architects
Synonyms: advocate, endorse, commend, suggest, put
forward, propose
Expeditious: done with speed and
efficiency.
Example: An expeditious investigation
Synonyms: speedy, swift, quick, rapid, fast, brisk, efficient, prompt
Consultation: the action or process
of formally consulting or discussing.
Example: They improved standards in
consultation with consumer representatives
Synonyms: discussion, dialogue, discourse, debate, negotiation, deliberation
Deliberation: long and careful
consideration or discussion.
Example: After much deliberation, we
arrived at a compromise
Synonyms: thought, consideration, reflection, contemplation
Implement: a tool, utensil, or
other piece of equipment, especially as used for a particular purpose.
Example: Agricultural implements
Synonyms: tool, utensil, instrument, device, apparatus, gadget, contraption
Disposal: the action or process
of throwing away or getting rid of something.
Example: The disposal of radioactive
waste
Synonyms: throwing
away, discarding, jettisoning, scrapping, recycling
Approach: a way of dealing with
something.
Example: We need a whole new approach
to the job
Synonyms: method, procedure, technique, modus
operandi
Devolution: the transfer or
delegation of power to a lower level, especially by central government to local
or regional administration.
Example: Even after devolution ,
local government had little autonomy.
Synonyms: decentralization, delegation, redistribution, transfer, surrender
Imperative: giving an
authoritative command; peremptory.
Example: The bell pealed again, a
final imperative call
Synonyms: peremptory, commanding, imperious, authoritative, masterful
Mandate: an official order or
commission to do something.
Example: A mandate to seek the
release of political prisoners
Synonyms: instruction, directive, decree, command, order, injunction
Nudge: a light touch or push.
Example: He gave her shoulder a nudge
Synonyms: poke, prod, jog, jab, push, dig
