role and functions of finance commission of india pdf

Role And Functions Of Finance Commission Of India Pdf

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Finance Commission of India

The commission will submit its report by October 31, Here is a primer on what the commission does and why:. A finance commission is set up very five years by the President under Article of the Constitution. Its main function is to recommend how the Union government should share taxes levied by it with the states. These recommendations cover a period of five years. The commission also lays down rules by which the centre should provide grants-in-aid to states out of the Consolidated Fund of India.

It is also required to suggest measures to augment the resources of states and ways to supplement the resources of panchayats and municipalities. Under the federal structure envisaged in the Constitution, most of the taxation powers are with the Centre but the bulk of spending is done by the states. Such a federal structure requires transfer of resources from the Centre, which levies and collects the big taxes such as income tax and indirect taxes like excise and customs, to the states.

Canada and Australia, which also have federal governments, have a similar tax-sharing system. The government can ask the commission to make suggestions on specific fiscal issues that it may want addressed. For instance, the government has asked the 14th Finance Commission to deliberate on the level of subsidies and explore statutory measures to insulate pricing of public utility services like drinking water, irrigation, power and public transport from policy fluctuations.

The new commission will also look at the impact of GST and suggest a mechanism to compensate states in case of revenue loss. Besides, it will deliberate on listing, disinvestment and sale of state-owned companies. The Constitution does not make the recommendations of the Finance Commission binding on the government of the day. However, there is a strong precedent that governments generally go by the suggestions as far as sharing of revenues is concerned. These recommendations relating to distribution of Union taxes and duties and grants-in-aid are usually implemented by a presidential order.

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Finance Commission of India: Powers, Functions and Responsibilities

The commission will submit its report by October 31, Here is a primer on what the commission does and why:. A finance commission is set up very five years by the President under Article of the Constitution. Its main function is to recommend how the Union government should share taxes levied by it with the states. These recommendations cover a period of five years. The commission also lays down rules by which the centre should provide grants-in-aid to states out of the Consolidated Fund of India.

What is Finance Commission?

State Finance Commission meaning: The Indian Constitution makers envisioned a two-tier democratic system with a strong federal government at the centre and states as its units. They also clearly demarcated the duties and responsibilities of the Union government and the states and further assigned revenue streams to both of them to discharge their duties and responsibilities. However, this model underwent a major change four decades after the Constitution came into effect. The 73rd Constitutional Amendment Act, formally recognised a three-tier system of local self-governance comprising at village level, block level and district level bodies. For instance, the Gram Panchayats have historically existed in the country for thousands of years as a unit of self-rule.

The first finance commission was formed on 22 November, The headquarter of Finance commission is in New Delhi. All the best for your upcoming exam. Your email address will not be published.

The Finance Commission of India was established on 22nd November, It was formed to describe the financial relations between the centre and the state. The Finance Commission has been provided for the Indian constitution as part of the scheme of division of financial resources between the two different sets of governments. Till now the President of India has asked the commission to make recommendations on the principles governing distribution of the net proceeds of estate duty in respect of Property Tax on Railway fare and excise duties on sugar and tobacco.

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Finance Commission of India: The Finance Commission is a constitutional body, that determines the method and formula for distributing the tax proceeds between the Centre and states, and among the states as per the constitutional arrangement and present requirements. The constitution makers were aware of the financial requirements of the Centre and the states. They devised an elaborate method, clearly demarcating the duties and responsibilities of the units of the Union and of the Union itself while allocating resources to perform those duties. To meet these requirements, the Finance Commission came into being. Under Article of the Constitution, the President of India is required to constitute a Finance Commission at an interval of five years or earlier. How many members are there in the Finance Commission? The Finance Commission has a chairman and four members appointed by the President.

It is mentioned under the Article of the Constitution, that the President shall constitute a Finance Commission every five years consisting of a chairman and four other members. The President appoints the Commission members based on the qualifications set by the Parliament for the appointment of members and the Chairman of the Finance Commission. The Parliament has enacted the Finance Commission Act, which specifies the qualifications required for the Chairman and the members of the Commission. The members should be selected from amongst the following-. Every member remains in the office till the pleasure of the President of India. The members are eligible for re-election. The Finance Commission can be constituted at such an earlier time as the President considers necessary.

Topics Covered:. Finance Commission of India. Context: People representatives of Panchayat Raj institutions and urban local bodies in Hyderabad are planning to make a case with the visiting 15th Central Finance Commission to enhance the quantum of funds to the local bodies. More so to release the share of funds that the zilla and mandal parishads used to get directly till the 14th Finance Commission discontinued the practice and diverted them to the gram panchayats. The Finance Commission is constituted by the President under article of the Constitution , mainly to give its recommendations on distribution of tax revenues between the Union and the States and amongst the States themselves.

Finance Commission

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Robert A.

Functions of Finance Commission​​ The Finance Commission makes recommendations to the president of India on the following issues: The net tax proceeds distribution to be divided between the Centre and the states, and the allocation of the same between states.

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Faith P.

Hbs case studies free pdf probability and statistics for engineering and the sciences 7th edition pdf

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