Tag: Finance Commission

An 8-member committee is set up by Finance Commission (FC) to review the fiscal consolidation road map of state & central governments. The committee is headed by 15thFinance Commission Chairman N K Singh. Key Points: By considering all of India’s explicit and measurable debt, it will make recommendations on the definition of deficit & debt for central government, overall states, general government and public sector enterprises (government levels) by bringing consistency between the definition of debt(stock) and deficit(flow) About FC: In 1951, under the article 280 of the constitution it was established to assess the financial position of the Union and State Governments, recommend the sharing of taxes among them, and set out policies to determine the distribution of these taxes among the States. The FC (Miscellaneous Provisions)Act, 1951 defines the terms of qualification, appointment, disqualification, term, eligibility & powers of FC. The 15thFC was constituted on 27 November 2017 against the abolition of the Planning Commission (the difference between plan and non-plan expenditure) & the introduction of Goods and Services Tax (GST).

The 15thFinance Commission has set up a 8-member group led by ITC chairman and managing director (MD) Sanjiv Puri to recommend measurable performance incentives for the states, so as to promote exports & also to encourage the concerned crops to ensure replacement of more imports.

The Fifteenth Finance Commission, in its interim report tabled in Parliament has recommended maintaining States’ share in the divisible pool of tax collections at virtually the same level of 42% set by its predecessor, for 2020-21. To factor in the changed status of the erstwhile State of Jammu and Kashmir, the rate at which funds may be shared with the States has been reset to 41%.