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Panagariya-led Sixteenth Finance Commission convenes inaugural meet

The tenure of the current finance commission, which was constituted on 31 December, ends in October 2025

Panagariya-led Sixteenth Finance Commission convenes inaugural meet
[Source photo: PIB]

The Arvind Panagariya-led Sixteenth Finance Commission, a Constitutional body that primarily decides on the formula for sharing tax revenues between the Union government and the states, convened its inaugural meeting this week.

The tenure of the current finance commission, which was constituted on 31 December, ends in October 2025.

“The 16th Finance Commission held its first meeting under the chairmanship of Arvind Panagariya in Jawahar Vyapar Bhawan, Janpath, New Delhi, the finance ministry said.

During the meeting, the commission deliberated on its terms of reference, as outlined by the President and notified by the finance ministry.

The commission’s terms of reference sanctioned by the Union cabinet includes the distribution of net tax proceeds between the Union and states. The allocation of these proceeds among states according to their respective shares was also deliberated upon at the meeting.

Recognizing the importance of extensive consultations, the commission underscored the necessity of engaging with various stakeholders, including state governments, local bodies, central government ministries, and experts.

The commission also emphasized the need for comprehensive analytical work and acknowledged the need to leverage expertise from leading research organizations, think tanks, and entities specializing in fiscal federal relations.

Former expenditure secretary Ajay Narayan Jha, retired bureaucrat Annie George Mathew, and Artha Global executive director Niranjan Rajadhyaksha are full-time member of the commission, while SBI Group Chief Economic Advisor Soumya Kanti Ghosh is a part-time member.

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