New Delhi: More than 22 out of 28 states have recommended an increase in their share of tax revenue distribution, Arvind Panagariya, chairman of the 16th Finance Commission, said on Wednesday (June 4).

Addressing a press conference, Panagariya said that most states had asked for their share to be increased from the current 41% to 50%. At the moment, 59% of the tax revenue is retained by the Union government.

This division of tax revenue was decided by the previous finance commission, Panagariya said.

The 16th Finance Commission, constituted in 2023, was asked to recommend a fresh division of tax revenue for a five-year period between April 2026 and March 2031.

The commission is currently conducting state-wise consultations as part of this exercise. “Like most other state governments, UP has also asked for the share to be raised to 50% from the present 41%,” Panagriya said.

When asked if the commission would recommend a 50% share for states in its final report, Panagariya said, “Practically speaking, I can't tell you [the press] what the commission will do because I also don't know it yet as it's a decision of full membership of the commission. What I can speculate though is it is not going to be 50% because that would be too large a jump and such a large jump upsets too many cards,” he told news agency PTI.

Panagariya also noted that in the past, the government has accepted the finance commissions’ recommendations in full.

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