Finance Commission

Centre extends tenure of 16th Finance Commission till November 30

The government has extended the tenure of the 16th Finance Commission by one month till November 30. The 16th Finance Commission was constituted by the government on December 31, 2023, with former Niti Aayog vice-chairman Arvind Panagariya as its Chairman. The report by the panel was due by October 31. The Commission will mainly make recommendations on the distribution of taxes between the Centre and states for a 5-year period starting April 1, 2026. The Finance Ministry, in a notification dated October 10, said that the date for submission of the 16th Finance Commission report is being extended till November 30. The Commission has four members and is assisted by Secretary Ritvik Pandey, two joint secretaries and one economic advisor. Retired bureaucrat Annie George Mathew and economist Manoj Panda are full-time members of the Commission, while SBI Group Chief Economic Advisor Soumya Kanti Ghosh and RBI Deputy Governor T Rabi Sankar are part-time members. Besides suggesting tax .

The Finance Commission is key to saving our cities from climate change

Its current horizontal devolution formula is insufficient to prepare cities to deal with floods and droughts caused by climate change

8th pay panel payout likely to trigger rate hike cycle in FY27: Report

Payout with sizeable arrears will hit core inflation harder, as it propels demand for goods and services overtime, and leads to an instantaneous reset of housing rents

Finance Commission must focus on strengthening local bodies: Raghuram Rajan

Former RBI Governor Raghuram Rajan noted that the previous finance commissions devolved more funds to the local bodies and urged for greater decentralisation in India

Andhra CM meets Sitharaman; seeks Rs 10,000 cr support for various projects

Andhra Pradesh Chief Minister N Chandrababu Naidu on Wednesday met Union Finance Minister Nirmala Sitharaman and sought additional financial support of Rs 10,000 crore for various projects. On his second day of the visit, the Telugu Desam Party (TDP) chief -- a key NDA ally -- highlighted that the state is still facing a deficit of financial resources due to bifurcation, an official release said. Naidu requested the central government to grant an additional allocation of Rs 10,000 crore under the Special Assistance to States for Capital Investment (SASCI) scheme for 2025-26. He sought the release of the second tranche of funds as a grant to Amaravati capital, and appealed to the Union Minister to make up for the revenue deficit faced by the state under the 16th Finance Commission. He submitted a memorandum requesting financial support for various state projects. The chief minister informed Sitharaman that the construction of Amaravati requires a total of Rs 79,280 crore, with work

Meghalaya CM seeks more funds for smaller NE states from finance commission

Meghalaya Chief Minister Conrad K Sangma advocated for enhanced financial support to the smaller Northeastern states, citing their unique geographical, economic, and developmental challenges. Sangma took up the issue during his meeting with members of the 16th Finance Commission in New Delhi on Monday. "Our states face distinct issues related to terrain, infrastructure gaps, and limited revenue-generating capacities. We need special financial consideration to address these structural disadvantages," Sangma said at the meeting. He urged the finance commission to recommend higher fund devolution and more flexible schemes to help smaller states address critical sectors such as roads, healthcare, education, and tourism. Sangma also called for greater autonomy in the utilisation of centrally allocated funds, allowing states to design projects suited to their needs. The commission assured him that the submissions would be carefully examined. "North East States, while having their own u

RBI's T Rabi Sankar joins 16th Finance Commission as part-time member

T Rabi Sankar's appointment comes after Ajay Narayan Jha, one of the full-time members of the commission, stepped down due to personal reasons

Over 22 Indian states demand 50% share in central tax revenue allocation

More than 22 states have asked the 16th Finance Commission to raise their share of central tax revenue from 41 per cent to 50 per cent, says chairman Arvind Panagariya

Jharkhand govt urges finance commission to raise tax share to 50%

The Jharkhand government on Friday appealed to the Sixteenth Finance Commission to raise the vertical devolution of central taxes from the existing 41 per cent to 50 per cent. A finance commission team, headed by its chairman Dr Arvind Panagariya, held discussions with the state government. Jharkhand Finance Minister Radhakrishna Kishore and Chief Secretary Alka Tiwari were present during the meeting. "Increase the vertical devolution share from 41 per cent to 50 per cent," the state government appealed to the panel. The commission also held a series of meetings with representatives from local bodies, trade organisations, industry associations, chambers of commerce, and political parties. The finance commission team on Thursday visited Jharkhand's temple town of Deoghar and offered obeisance at the Baba Baidyanath temple. The finance panel also held discussions with representatives of panchayati raj institutions and administrators of urban local bodies from all six districts of ..

54 per cent of Maharashtra's GSDP comes from only 7 districts: Govt report

Only seven out of 36 districts in Maharashtra contribute 54 per cent of the gross state domestic product (GSDP), which stood at Rs 45 lakh crore in 2024, a government report has said, indicating a stark regional imbalance. These seven districts, where economic activities are largely concentrated in the state, which is considered an economic powerhouse in the country, include two districts of Mumbai, Pune and Nagpur. The report submitted to the 16th Finance Commission revealed that 18 districts have a growth rate less than 0.8x of the GSDP expansion rate and per capita income below average state income. GSDP measures the total value of goods and services produced within a state's boundaries during a specific period. While Maharashtra's per capita income was 148 per cent of the national average, 12 districts in the state have per capita income below the national average, it said. According to the report, the state government has formulated district strategic plans spanning five year

16th Finance Commission will submit report to Centre by Oct 31: Chairman

Chairman of the Sixteenth Finance Commission Dr. Arvind Panagariya on Monday said the commission will submit its report to the central government by October 31. Panagariya said this in a meeting of the commission held here with Chief Minister Pushkar Singh Dhami. The chairman praised Uttarakhand for moving ahead rapidly on the development front and said that in view of the difficult geographical conditions, extensive discussions will be held to find solutions to the challenges being faced by other hill states, including Uttarakhand. Earlier in the meeting, CM Dhami presented his views on the financial situation, challenges and development needs of the state. He requested the Finance Commission to provide suitable compensation in keeping with the spirit of 'environmental federalism' in view of Uttarakhand's 'eco service cost', increase the weightage of forest cover in 'tax-devolution' to 20 per cent and consider special grants for proper management and conservation of forests in the

Resource allocation: Finance Commission needs to address multiple issues

The second important issue raised by some states was that of the increased use of cesses and surcharges by the Union

Ajay Narayan Jha steps down from Finance Commission with 6 months to go

The former finance secretary was appointed secretary, expenditure, in the Ministry of Finance in October 2017 and remained in office until February 2019

Bihar makes fresh demand for special status before 16th Finance Commission

The Nitish Kumar government in Bihar on Thursday made a fresh demand for special category status before the 16th Finance Commission, members of which are currently on a tour of the state. This was disclosed by Arvind Pangariya, the renowned economist who is also the chairman of the commission, while interacting with the media after receiving the state government's memorandum. "It was a lengthy presentation made in the presence of the chief minister, his deputies and other cabinet colleagues, besides top officials... prior to Bihar, we have covered 20 states. Our tours began in June last year, after the Election Commission lifted the Model Code of Conduct imposed during Lok Sabha polls," Pangariya said. "The demand for a special category status is part of the memorandum of the Bihar government... (but) this is not something that the Finance Commission has jurisdiction over," he said. "At the moment, no state has special category status. It used to be under the Planning Commission. .

Raise state's share in central taxes to 48%: MP CM to Finance Commission

Madhya Pradesh Chief Minister Mohan Yadav on Thursday asked the 16th Finance Commission to increase the share of states in the Central taxes pool from the current 44 per cent to 48 per cent to ensure the nation's development. Developed India cannot be built without a developed Madhya Pradesh, Yadav said while addressing a meeting with the chairperson and members of 16th Central Finance Commission at Kushabhau Thackeray International Convention Centre here. "The strength of the nation lies in the strength of the states. Therefore, the share of the states in Central taxes and revenue receipts, i.e. grants, must be increased. By getting more financial grants from the Union government, the states will be able to achieve their long-term goals in the short term," the CM said. Asserting that MP was progressing rapidly in the fields of agriculture, infrastructure, education, health, forest, tourism, urban development and industrial development, he said strong financial support/grants are ..

CAG Murthy, Arvind Panagariya hold consultation on public finance, revenue

Comptroller and Auditor General of India (CAG) K Sanjay Murthy on Wednesday held consultations with Chairman of 16th Finance Commission Arvind Panagariya on various aspects of public finance, including untapped revenue sources, GST administration, and standardisation of accounting practices in all tiers. The high-level consultation formed a critical part of the commission's ongoing assessment of the financial landscape of the Centre and states, the CAG office said in a release. The deliberations mainly focused on three key areas - Union and state finances, local bodies, and Public Sector Enterprises (PSEs). The Union, the states, local bodies and the PSEs are under the audit of the CAG. In addition, the CAG maintains the accounts of the states. The CAG shared various audit findings for the Union and states in different sectors, fiscal challenges and stress points, including the gap between expenditure and non-debt receipts for the Union and states combined. The key areas of concer

Centre releases Rs 699 crore grants for rural local bodies in West Bengal

The Centre has released the 15th Finance Commission Grants for the Financial Year 202425 for Rural Local Bodies in West Bengal, which includes the second installment of Untied Grants of Rs 694.4 crore and the withheld portion of the first installment of Untied Grants of Rs 4.9 crore. According to the Panchayati Raj Ministry, these funds are for the 21 eligible District Panchayats, 326 eligible Block Panchayats and 3,220 eligible Gram Panchayats. The Ministry said the Untied Grants would be utilised by Panchayati Raj Institutions (PRIs) and Rural Local Bodies (RLBs) for location-specific needs under the Twenty-Nine (29) Subjects enshrined in the Eleventh Schedule of the Constitution, except for salaries and other establishment costs. The Tied Grants can be used for the basic services of sanitation and maintenance of ODF status, and this should include management and treatment of household waste, human excreta and fecal sludge management in particular and supply of drinking water, ...

Need 7.3% per capita income growth for 'Viksit Bharat' by 2047: Panagariya

The 16th Finance Commission Chairman Arvind Panagariya on Saturday said India's aim to become a developed nation by 2047 is a "realisable ambition" for which the country's per-capita income needs to grow at 7.3 per cent in dollar terms to USD 14,000 over the next 24 years. India's per-capita income, in 2023-24 dollar terms, is about USD 2,570, which is very low compared to countries like South Korea, Taiwan, United States, and other European nations. Speaking at the 49th Civil Accounts Day, Panagariya said with the existing technology, coupled with reasonable capital accumulation and skill acquisition, India has enormous room for catching up with the per-capita income of developed nations and meet World Bank's definition of USD 14,005 per capita income annually. Today, our per capita income in dollars is about USD 2,500. To get to USD 14,000 in 24 years or by 2047-48, what growth rate do I need for per capita income? my per capita income from 2023-24 onward has to grow annually at

Odisha asks Rs 12.59 trn from Finance Commission, 50% divisible pool share

The Odisha government on Thursday requested Rs 12.59 lakh crore from the 16th Finance Commission and sought an increase in the state's share of the central divisible pool to 50 per cent from the current 41 per cent. Chief Minister Mohan Charan Majhi made the request during a meeting with the Finance Commission team, led by Chairman Aravind Panagariya, emphasising that the demand was crucial for the state's development, particularly as it aims to become one of the country's developed states by 2036, marking its centenary. Addressing a press conference, Panagariya said many states including Odisha have demanded increasing their share to 50 per cent from the central divisible pool. The 16th Finance Commission is mandated to submit its report with the President of India in October 2025 and make its recommendation after visiting 28 states and taking views of all the stakeholders. "The commission has visited several states and held consultations. Maximum states demanded an increase in the

States must raise tax devolution concerns with Finance Commission: FM

With southern states voicing concerns over 'unfair' tax money devolution, Finance Minister Nirmala Sitharaman has said the states have to engage and highlight their concerns with the 16th Finance Commission, whose recommendations will decide how the funds are divided. Population is one of the criteria used by Finance Commissions to decide how the tax revenues are divided. Southern states, which have managed to check the rise in population, feel they get a raw deal when compared to the northern states with much larger population growth. In an interview with PTI, Sitharaman said the central government does not decide on the devolution formula. The devolution of taxes is made in accordance with the recommendations of the Finance Commission and the aggrieved southern states should approach the panel for change in parameters. "It is for the states to engage with the Finance Commission to express their concerns about the parameters based on which the tax devolution principles are laid dow