New Delhi: States today (Nov 30, 2004) demanded that Centre should share with them the Service Tax mop up on a 50:50 basis but Finance Minister P Chidambaram said any decision on the issue would be taken by a "consensus".

"A variety of views were expressed. We will examine the views carefully. I have no doubt, we will reach a consensus," Chidambaram said at the conclusion of the first ever meeting of State Finance Ministers with senior officials of Union Finance Ministry on Service tax.

"Some very interesting ideas were thrown up and important issues highlighted. It's an encouraging process," he said.

Speaking on behalf of States, West Bengal Finance Minister Asim Dasgupta said, "All States have said Central Government should collect Service Tax but it should be shared on a 50:50 basis."

Also, certain States wanted some of the "major" services for taxation, he said, adding no conclusion could be reached on that.

At present, 29.5 per cent of the divisible central pool of taxes goes to States as per the formula determined by the Eleventh Finance Commission.

The Twelfth Finance Commission, headed by C Rangarajan, is in the process of finalising its recommendation on the devolution of resources among States and Centre for the next five years and has sought their views.

There has already been a demand for a higher share of tax revenues to States considering the deteriorating financial health of most of them.