RS members seeks clarity on allocation to states from Health Security se National Security Cess

New Delhi, Dec 8 (PTI) Rajya Sabha members have sought clarity on the way allocation will be made to states from Health Security se National Security Cess as health is a state subject.

The Health Security se National Security Cess Bill, 2025, seeks to levy cess on manufacturing units of pan masala to augment expenditure on national security and public health.

"Since cess and surcharges are not being shared with states, in spite of the repeated requests by states, I would like to seek clarification from the minister whether the proceeds of the Health Security se National Security Cess is going to be shared with states since health is a state subject and it is a primary responsibility of states to implement schemes and programmes relating to health," YSRCP member Golla Baburao said while participating in the discussion on the bill.

While Baburao supported the bill, he said the finance minister has not specified the activities of national security for which the cess is going to be used.

"For that matter, she (Nirmala Sitharaman) has not mentioned how the cess is used for public health," Baburao said adding the minister should have specified the contours for sharing the cess with states.

AAP member Ashok Kumar Mittal said breathing in Delhi is like smoking 25 cigarettes per day but the bill has no plan to deal with pollution.

He said that the tax collected by the government is shared with states but cess money is entirely kept by the Centre.

"The share of cess has increased in the revenue collection of the central government. This is causing so much loss to states. The August 25 report of CAG says that the central government has failed to transfer Rs 3.69 lakh crore worth of cess collection to intended reserve," he said.

He said that Section 21 of the bill says that any court will take cognisance of a crime only when the commissioner of that department permits it.

"Sir, this is the case of Inspector Raj. If an officer commits a mistake, the common citizen cannot even go to court. This is against justice," Mittal said.

He said as per the 15th Finance Commission report, cess and surcharge share in gross tax has increased from 10.4 per cent in 2011-12 to 26 per cent, which is causing loss to states.

CPI (M) member John Brittas said the finance minister often blames non-BJP ruled state for not managing resources well.

He said that there is a trust deficit at least between the union government and states rules by the Opposition parties.

Brittas sought clarity on the way the Centre plans to channelise resources from the cess to states.

TMC member Saket Gokhale said the bill has provision to double the cess simply by citing public interest.

"The power of taxation is purely, solely the domain of Parliament. Through this bill, the union government is giving itself power to double the tax rate without putting it to a Parliamentary board. This is an absolute mockery of Parliament," Gokhale said.

DMK member Kanimozhi NVN Somu said that a nation becomes stronger when its states are strong--financially, administratively, politically.

"When the Union holds all the power, keep all the revenue and leave the states pleading for rightful dues, the federal soul of the nation is compromised. Tamil Nadu will cooperate but never kneel. We will never allow our rights, our revenues or our autonomy to slowly chipped away under the guise of reforms," Somu said.

BJD Member Sulata Deo, AIADMK member M Thambidurai, nominated member Sudha Murty, BJP members Milind Deora, Sikander Kumar, Ajeet Madhavrao Gopchade also participated in the discussion on the bill. PTI PRS PRS ANU ANU