IANS | 29 Nov, 2023
The Union Cabinet has approved the terms of reference for the 16th
Finance Commission which include the distribution of taxes between the
Centre and states.
According to an official statement issued on Wednesday, the terms of reference for the 16th Finance Commission are:
The
distribution between the Union and the states of the net proceeds of
taxes which are to be, or may be, divided between them under Chapter I,
Part XII of the Constitution and the allocation between the States of
the respective shares of such proceeds;
The principles which
should govern the grants-in-aid of the revenues of the States out of the
Consolidated Fund of India and the sums to be paid to the States by way
of grants-in-aid of their revenues under article 275 of the
Constitution for the purposes other than those specified in the provisos
to clause (1) of that article; and
The measures needed to augment
the Consolidated Fund of a State to supplement the resources of the
Panchayats and Municipalities in the State on the basis of the
recommendations made by the Finance Commission of the State.
The
Commission may review the present arrangements on financing Disaster
Management initiatives, with reference to the funds constituted under
the Disaster Management Act, 2005, and make appropriate recommendations.
The Commission will make its report available by October 31, 2025 covering a period of five years commencing on April 1, 2026.
The terms of reference for the 16th Finance Commission will be notified in due course of time, the statement added.
