India’s policy discourse has immensely benefited from Govinda Rao’s contributions in Public Finance and fiscal policy and in particular, in the areas of fiscal decentralisation and federalism, state and local finances, tax policy reforms, rule-based fiscal policy and public expenditure management. His tireless efforts in striking fiscal federal balance have resulted in a greater role for sub-national governments. He was persuasive in ensuring that the 14th Finance Commission incorporated the plan requirements of the states which resulted in the 10 percentage point increase in tax devolution.
His contribution was instrumental in the introduction of taxation of three services – non-life insurance, stock broakerage and telecom in 1994.  As the Chairman of the Expert Group on taxation of services in 2001, he recommended extending taxation to all services and provide tax credit for both goods and services to evolve GST, which was taken up by the later committees.  Reforms in the tax system introduced by him have raised revenue productivity.