Impact on States of Central Tax Preferences: An Analysis of Important Tax Preferences
Publication dateJan, 2009
DetailsReport submitted to the Thirteenth Finance Commission
AuthorsR. Kavita Rao
This study attempts to assess the statewise impact of central tax preferences. Since there are a large number of tax preferences, an attempt has been made to assess and allocate the impact of some of the major tax preferences. It is found that if the preferences specifically targeted towards the backward areas are not included, there is a bunching of incentives in higher income states. However, some of this impact is neutralized by the benefits accruing on account of the incentives provided to backward areas.