India, March 25 -- Various Opposition-ruled States especially from south India have complained of 'discrimination' and 'unfair' treatment under the present scheme of sharing financial resources between the Union Government and the States.

Article 270 of the Constitution provides for the sharing of net tax proceeds collected by the Union government with the States. The taxes that are shared include corporation tax, personal income tax, Central GST (Goods and Services Tax) of CGST, the Centre's share of the Integrated Goods and Services Tax (IGST), CED on petroleum products excluding the cess and surcharge levied by the Centre etc. All these taxes put together constitute the 'divisible pool'.

This division is based on the recommendation o...