's leader in the Rajya Sabha Derek O'Brien on Friday said cess was "slitting the throat of federalism".
"In the hoopla about GST, the four-letter word slitting the throat of federalism is CESS," O'Brien wrote in a blog post.
He added that funds collected as cess entirely go to the Centre, with not a rupee shared with states.
O'Brien said: "In 2012, cess formed 7% of the Union govt's total tax revenue. In 2025, cess was estimated to be 20% of total tax revenue; Rs 5.7 lakh crore cess and surcharge were lying unutilised since 2019." "Twenty-two states, including many governed by BJP, protested against the shrinking divisible pool. These states asked the 16th Finance Commission for a larger share of tax collections — currently 41%, to be raised to 50%," O'Brien said.
"As per RBI, the divisible pool shrank from 89% of gross tax revenue in 2011 to 79% in 2021. This, despite the 10% increase in tax devolution as recommended by the 14th Finance Commission…Between 2015 and 2024, cess (in operation) increased by 462% (over Rs 2 lakh crore)," he added. tnn