The finance panel will devise the formula by which the Centre and states will share revenue between 2020 and 2025. The commission’s terms of reference will be notified in due course of time, Finance Minister Arun Jaitley was quoted as saying by Moneycontrol.
“The next step will be to decide on who its members will be and notify the same so that it can begin its work,” he said.
Jaitley said that Arbind Modi, a member of the Central Board of Direct Taxes, will lead the task force given the responsibility to come up with a new direct tax law. Prime Minister Narendra Modi, he added, wants to simplify the law and raise the country’s low direct tax base.
The Cabinet on Wednesday also gave the green signal to wage revision for central public sector enterprises. “The wage revision shall be subject to the condition that there shall be no increase in labour cost per physical unit of output,” the Finance Ministry said.
The management at such public sector units will be free to negotiate the salaries of workmen, keeping affordability and the financial sustainability of such a revision in view. The ministry said the government will not provide any budgetary support for increase in wages.