Rapid Fire
Extension of 16th Finance Commission Tenure
- 16 Oct 2025
- 2 min read
The government has extended the tenure of the 16th Finance Commission (FC) by one month till 30th November.
- The 16th FC, chaired by economist Arvind Panagariya, was initially scheduled to submit its report by 31st October 2025 for the 5 year period beginning 1st April 2026.
Finance Commission
- About: FC is constituted by the President of India under Article 280 of the Constitution every five years or earlier.
- It submits its report to the President, who places it before both Houses of Parliament.
- Composition: A Chairperson and four members, all appointed by the President.
- Qualification: The Constitution empowers Parliament to establish the qualifications for Finance Commission members.
- Under the Finance Commission Act, 1951, the Chairman must have experience in public affairs. The four other members are selected from those with expertise as a High Court judge, in government finance and accounts, financial administration, or economics.
- Term: They hold office for the period specified by the President and are eligible for reappointment.
- Functions: The Finance Commission advises the President on:
- Distribution of tax proceeds between Centre and states, and among states.
- Principles for grants-in-aid to states (Article 275).
- Measures to augment state funds for Panchayats and Municipalities.
- Other financial matters referred by the President.
| Read More: Issue of Urban Finance and 16th Finance Commission |
