South Indian States don’t get their due share from the Central pool of revenue, says Shashi Tharoor

Congress MP Shashi Tharoor speaks in the Lok Sabha during the Budget session of Parliament, in New Delhi, on March 24, 2025.
| Photo Credit: PTI/Sansad TV

Initiating the debate on the Finance Bill in the Lok Sabha on Monday (March 24, 2025), Congress leader Shashi Tharoor said south Indian States have been the engines of growth and revenue but don’t get their due share from the Central pool of revenue.

However, BJP’s Nishikant Dubey hit back, saying the Congress was used to opposing everything without looking at the positives.

Senior Opposition members, including Congress’s Deputy Leader in the House Gaurav Gogoi and senior member K.C. Venugopal, protested the fact that Minister of State for Finance Pankaj Choudhury was present instead of Union Finance Minister Nirmala Sitharaman when the House was taking up the discussion.

Calling the Finance Bill a “classic case of patchwork solutions”, Mr. Tharoor said the government’s financial management finds itself in the midst of deep-rooted structural challenges.

“The Finance Minister’s budget speech in this House reminded me of the garage mechanic who said I couldn’t fix your brakes, so I made the horn louder but looking at the Finance bill, she is now saying to taxpayers, I couldn’t repair the roof but I brought you an umbrella,” he said.

Pitching for a higher share from the Central revenue pool, the Congress member from Kerala’s Thiruvananthapuram constituency said, “And let me say, ma’am, that the five southern States—Andhra Pradesh, Tamil Nadu, Kerala, Karnataka, and Telangana—are among India’s strongest economic engines. They are paying taxes, they generate over a quarter of the country’s direct taxes, they contribute 28.5% of GST, but when it comes to receiving their fair share, they get a mere 15% of the Centre’s tax pool. How is this acceptable? How can States that fuel the nation’s economy be expected to sustain their growth with such an inadequate return?”

The Congress leader said goods and services tax (GST) in the country was “most confusing and complex GST structure in the world. “Instead of the good and simple tax we all wanted, India has multiple and confusing GST rates, including the highest GST rate in the world, at 28% but tax revenues are still at 18% of GDP,” he said, adding that China has 13% GST cap, but they collect 20% of GDP.

He also used verse to make a point about taxation in India and mentioned several economic challenges like “soaring unemployment, economic inequality, stagnating exports, shrinking manufacturing sector, wealth as well as high net worth individuals leaving the country”.

Mr. Dubey, who spoke next, said the Budget does not provide a magic solution to all problems. “It is a result of hard work aimed at helping the workers…it is Congress’s agenda to oppose everything without looking at the positives. You need to answer what did you (Congress) do for the poor and salaried class.”

The Jharkhand MP said the Indian economy which was worth USD 2 trillion has increased to USD 4.5 trillion in the past ten years.

Intervening, Mr. Venugopal alleged that a corporate loan worth ₹18 lakh crore has been written off by the BJP government, to which Ms. Sitharaman said written off does not mean that the money has been given away. “The government is following up with cases.”

Trinamool Congress MP Mahua Moitra alleged that the government was favouring crony capitalists at the expense of small businesses and workers.

She claimed that the government has created special rules to benefit certain businessmen. “All tax rules are written for Vishwakarma’s India, not Kuber’s India. But when it comes to crony capitalists, there are special rules.”

She accused the government of engaging in “tax terrorism”, stating that stock market investors, corporates and small business owners have all been victims.

Ms. Moitra also said that the official figures on the footfall at Maha Kumbh held recently were inflated.

Congress MP Hibi Eden flagged the GST on life-saving drugs. “There are thousands who suffer from spinal dystrophy. The cost of the medicine is exorbitant, then there is 5% GST on this. The government needs to scrap it.”