The 14th finance commission report has been accepted by the center,the report has been tabled today and it recommended that the center transfer 42% of divisible pool to the states, including taxes and grants the th finance commission had suggested it a 39. This is the largest ever jump in percentage of devolution. However, it is believed that the devolution could be less than the 42 per cent prescribed by 14th finance commission. The 14th finance commission was set up on january 2, 20. The accepted recommendations are for the fiveyear period 201516 to 201920. They also deal with devolution of nonplan revenue resources. Report of the 15th finance commission for fy 202021. States share in the net proceeds of union tax revenues increased to 42% from 32% earlier. Thirteenth finance commission economic and political weekly. Pdf challenges before the fifteenth finance commission. The commission comes out with its reports highlighting reforms relating to the fiscal scenarios. The 14th finance commission has recommended a record 10% increase in the states share in the union taxes to 42% as compared to the th finance commission.
Introduction the fourteenth finance commission ffc was constituted by the president on january 2, 20 to give recommendations on specified aspects of centre state fiscal relations during 201520. Performance audit of ulbs on financial and performance reporting i. The share of states in the divisible pool of taxes collected by the union has been enhanced to 42% from 32%. The finance commission miscellaneous provisions act, 1951 was passed to give a structured format to the finance commission and to bring it to par with world standards, by laying down rules for the qualification and disqualification of members of the commission, and for their appointment, term, eligibility and powers. Chapter 6 role and recommendation of finance commissions. Here we are sharing some important information about 15th finance commission. Pdf the terms of reference of the fifteenth finance commission are significantly. The 14th finance commission had recommended grants to states for three purposes. Oct 20, 2019 the 15th finance commission is the first finance commission set up after the abolishment of the planning commission. Its report, based on the recommendations of a task force constituted to study the issue, recommends a highly uniform and centralised format that does not adequately recognise a tax reform exercise in a multilevel fiscal system that involves compromises and tradeoffs. The 14th finance commission has been hailed as pathbreaking for recommending larger fund allocations to state governments and giving them more autonomy in spending these funds. Based on this an additional tax devolution of 10% was given to the states.
Read more about guidelines for local body grants recommended by the fourteenth finance commission. It was formed to define the financial relations between the central government of india and the individual state governments. Corporation and income tax cannot be merged as they are separately recognized in the constitution itself. The concentration is accomplished by way of purchase. Article 280 of the constitution of india requires the constitution of a finance commission every five years, or earlier. Apr 17, 2018 the 14th finance commission has recommended a record 10% increase in the states share in the union taxes to 42% as compared to the th finance commission. Explore 14th finance commission profile at times of india for photos, videos and latest news of 14th finance. Tax devolution the most widely reported recommendation of the 14th fc is to increase vertical devolution. Following the constitution of the niti aayog and the recommendations of the 14 th finance commission ffc, central plan assistance to scs states has been subsumed in an increased devolution of the divisible pool to all states from 32% to 42%. The fourteenth finance commission of india was a finance commission constituted on 2. The first report, consisting of recommendations for the financial year 202021, was tabled in parliament on february 1. Headed by former reserve bank of india governor yv reddy, its recommendations cover the period from april 1, 2015 to march 31, 2020.
The 15th finance commission may split open demographic. Latest and breaking news on 14th finance commission. The commission is headed by former reserve bank of india rbi governor y v reddy. The fourteenth finance commission ffc was appointed on 2ndjanuary, 20under the chairmanship of dr. Performance grant is to be received for the period of 5 years during the year 201520. The commission s chairman was former reserve bank of india governor y. The first report, consisting of recommendations for the financial year 202021, was tabled in parliament on february 1, 2020. The disbursement of the performance grant in fourteenth finance commission. On 17 september 2018, the european commission received notification of a proposed concentration pursuant to article 4 of the merger regulation by which cma cgm acquires within the meaning of article 31b of the merger regulation sole control of the whole of container finance. The 15th finance commission may split open demographic fault lines between south and north india. However, after joining the indian union in 1975, sikkims population has grown at. Performance grant is to be received from the year 201617.
As articulated in the 14th commission s report, between 200205 and 200511, revenue expenditure by the union government on state list subjects increased from an average of 14 per cent to 20 per cent, and on. For the period from 1st april, 2015 to 31st march, 2020, the 14th finance commission ffc was constituted by the orders of president on 2nd january, 20 and submitted its report on 15thdecember, 2014. Vitta ayoga was established by the president of india in 1951 under article 280 of the indian constitution. Guideline for use of incentive amount in state finance commission s. The finance commission, set up in 1951 under article 280 of the constitution, basically decides how revenue has to be distributed between the centre and the states. Government has accepted fcs recommendation to increase the devolution of tax receipts from the centre to the states to 42 percent.
Guidelines for the performance grant disbursement in fourteenth finance commission. Five years ago, when the 14th finance commission recommended an increase in devolution of funds to state governments and a hike in the share of untied funds they received, it was heralded as a new. Highlights of 14th finance commission report february 2015 ficci economic affairs and research division government accepts 14th finance commission recommendation for tax devolution receipts states share in the net proceeds of union tax revenues increased to 42% from 32% earlier. As per the recommendations of the 14th finance commission, grantsinaid constitute 12% of the central transfers to states.
Components of total transfer to states decided by finance commission and planning commission finance ministry. The 14th finance commission s report201520 was approved by the government. The finance commission is a constitutional body formed by the president of india to give suggestions on centrestate financial relations. When the 14th finance commission took the resource share of the states up, from 30% to 42%, this need not have any adverse impact for central finances as it should merely involve expenditures down to the state government level where they belong. The fourteenth finance commission had submitted its report to the president pranab mukherjee in december 2014. Department of expenditure comes under ministry of finance javascript is a standard programming language that is included to provide interactive features, kindly enable javascript in your browser. Jul 14, 2018 the 14th finance commission recommended rs.
In order that the financial position of urban local bodies is. Why states are demanding more from the 15th finance commission. Mar 29, 2018 the finance commission, set up in 1951 under article 280 of the constitution, basically decides how revenue has to be distributed between the centre and the states. But this requires clarity and energy in reforming the machinery of central expenditure. Highlights of 14th finance commission report february 2015 ficci economic affairs and research division government accepts 14th finance commission recommendation for tax devolution receipts states share in the net proceeds of union tax revenues increased to. Allocation for social sector including education and health care rs. A great help by your video lectures and pdf uploded by you. The fourteenth finance commission is of the view that tax devolution should be the primary route of resources to the states. Apart from the tax devolution, the thirteenth finance commission hereafter tfc has given a large number of conditional grants linking. Finance commission in its report has given their views on the devolution of tax receipts from the centre to the states from 1st april 2015 to 31st march 2020. This is 10% more compared to 32% target set by th financial commission. Union government has accepted recommendations of the 14th finance commission fc as per its agenda of cooperative federalism. Accounting system and the national municipal accounts manual respectively.
Jha, secretary, fourteenth finance commission, who wrote to the vice. Restructuring of centrally sponsored schemes chaturvedi committee recommendations 2014 in 2014, the upa2 government approved planning commission s proposal to merge the 147 centrally sponsored schemes css and bring it down to 66 across various sectors for effective implementation and monitoring of the 12th five year plan. The 14 th finance commission has submitted its report to the president pranab mukherjee. The fourteenth finance commission ffc was constituted by the president on january 2, 20 to give recommendations on specified aspects of centre state fiscal relations during 201520. In addition to the above, the state government must continue with the. The fourteenth finance commission was constituted by the president under article. Stand up india scheme to facilitate at least two projects per. Government accepts 14th finance commission recommendation for tax devolution.
Reddy was appointed the chairman of the commission. The fifteenth finance commission was constituted on 27 november 2017 against the backdrop of the abolition of planning commission and the introduction of the goods and services tax gst, which has fundamentally redefined federal fiscal relations. Fourteenth finance commission ffc for rural and urban local bodies local bodies grant. The fourteenth finance commission of india was a finance commission constituted on 2 january 20.
Role and recommendation of finance commissions and planning committees planning based on a clear idea of the magnitude of available resources and anchored, to the extent possible, in selfgenerated resources is the sine qua non of responsible planning. Key features of the fourteenth finance commission recommendations to. The fourteenth finance commission was constituted by the president under article 280 of the constitution on jan. It is also under the ambit of the finance commission to define the financial relations between the union and the states. The thirteenth finance commission was required to look into the revenue impact of the introduction of the goods and services tax. Adherence to the recommendations of finance commissions by the union. Previously, the planning commission undertook plan expenditures, but now, with more power in the hands of fc, revolutionary measures to equalise opportunities, bring uniformity in public services and promote labor intensive growth. Report of the 15th finance commission for fy 202021 prsindia.
In addition to the primary objectives mentioned above, the terms of reference for the commission sought suggestions regarding the principles which would govern the quantum and distribution of grantsinaid non. The fourteenth finance commission had stepped up the share of. The formula used in the fourteenth finance commission is not the same as that used by its predecessor and so the share of individual states cannot really be compared. Fourteen 14th finance commission economics study material. Finance commission submits interim report for fiscal 202021 the.
The recommendations of the commission entered force on april 2015. Key recommendations of the 14th finance commission i. The share of states in the net proceeds of the shareable central taxes should be 42%. Recommendations of the 14th finance commission the hindu. The government of india, with the approval president of india, has constituted fifteenth finance commission. The commission recommends to increase the tax devolution of the divisible pool to states to 42% for years 2015 to 2020. The 14th finance commission could go a step forward and recommend 5% and 3% of the union divisible pool, under article 280 clause 3 bb and c, to panchayats and municipalities respectively. Guidelines for local body grants recommended by the fourteenth finance commission. The 14th finance commission was setup by the president in january 2014 under the chairmanship of the former rbi governor y v reddy and its other members were sushma nath, m govinda rao, sudipto mundle, abhijit sen. The 15th finance commission is the first finance commission set up after the abolishment of the planning commission.
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