ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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FINANCE COMMISSION-Questionable Criterion

Questionable Criterion THE use of the poverty ratio by the Ninth Finance Commission us a criterion for tax-sharing among the states raises quite a number of issues. Not that the commission was being particularly innovative, but what is noteworthy is that it chose the poverty ratio knowing full well that its predecessor commission had rejected this criterion and that too on grounds which included "doubts about the reliability of data and the methodology used for the estimation of these poverty ratios". There 'is no evidence of any attempt on the part of the present commission to improve the dependability of the data. The fact that the Planning Commission's estimates of poverty ratio are being used for the allocation of the major part of funds to the states for financing anti-poverty programmes seems to have been enough to persuade the commission to use these estimates for its purposes

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