What Is Finance Commission?


Author: Lisa
Published: 5 May 2022

The Finance Commission of India

The Finance Commission of India is a constitutional body that decides the method and formula for distributing the tax proceeds between the Centre and states.

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The States are able to provide basic public goods and services with equivalent tax effort by horizontal devolution. The criteria for horizontal devolution are classified into three broad groups. The XV-FC is considering sectoral grants for nutrition, health, pre-primary education, judiciary, rural connectivity, railways, statistics and police training.

The 15th Finance Commission of India

The Vitta Aayog is a body that defines financial relations between the union and state governments of India. The Financial Commission of India is tasked with the responsibility of suggesting how financial resources can be shared between the governments with an aim to reduce the amount of money that is transferred. Some states are unable to raise enough resources due to their regional differences.

The states are able to distribute their tax revenue to the respective institutions. The 15th Finance Commission of India was formed in November of last year by the President. The Finance Commission's Chairman needs to be experienced in public affairs.

The commission was required to submit reports. The first report with recommendations for the financial year. The second and final report would have recommendations for the period of 2021-26, which is due for submission by October 2020.

The revenue deficit grants and tax devolution received by the states in 2020-21 is expected to decline due to the special grants being offered. The commission has recommended a grant of Rs 90,000 cr to the local bodies in 2020-21. The new allocation is less than the previous one.

The Indian Budget

India is a federal nation and suffers from fiscal imbalances. State expenditures are disproportionate to their sources of revenue, which leads to vertical imbalances between the central and state governments. States are more efficient at addressing the needs of their inhabitants because they are better able to gauge the needs and concerns of their inhabitants. State governments can have horizontal imbalances due to differing historical background or resource endowments.

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Commissions can be charged if an order is filled, canceled, or modified. Commission is not charged when a market order is unfilled. Extra charges may be added to the commission if the order is canceled or modified.

The body is set up under the constitution

The body is set up under the constitution. Its main job is to recommend measures and methods for how revenues are distributed between the Centre and states.

The Finance Commission of the Union

The President has the power to create the Finance Commission under article 280 of the Constitution to give recommendations on the distribution of tax revenues between the Union and the States.

The 14th Finance Commission Grants to States

The 14th Finance Commission Grants to states are well-known. The Centre transfers a lot of money from its own resources to states and vulnerable groups. The Finance Commission has a significant role in Centre-State financial relations.

The Finance Commission

The president of India will appoint the Finance Commission's chairman and four other members. K.C Neogy was the first chairman of the commission. N.K Singh is the head of the 15th Finance Commission.

A Blended Compensation Package for Salespeople

Selling products is hard. Tough competition is what professionals in sales and marketing deal with. Employers can give their employees a commission to make them more productive and to make them more sales and customers.

Commission-based compensation is usually offered in sales and marketing jobs industries such as automobiles and real estate. It can be a part of the salary of an employee or a separate form of income. It is calculated by the percentage of sales.

The higher the amount of products or services an employee can sell, the higher the amount they receive. Highly motivated salespeople can make a lot of money, but they can become too focused on the commission. They will not fully explain their products to potential customers.

They can discourage people from buying their goods. New customers may be turned off by too much hard selling and other high-pressure tactics if they use overly aggressive sales methods. A blended compensation package is a way to strike a balance between salary and commission.

The Fifteenth Finance Commission

List of Finance Commissions and their heads is a static topic for competitive exams. You can expect a lot of questions from List of Finance Commission and their head in competitive exams. The Fifteenth Finance Commission is an Indian Finance Commission that is to give recommendations for devolution of taxes and other fiscal matters for five fiscal years.

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