New Delhi: The Government of India, with the approval of the President of India, has constituted the Sixteenth Finance Commission in pursuance of Article 280(1) of the Constitution. Dr. Arvind Panagariya, former Vice-Chairman of NITI Aayog and Professor at Columbia University, will serve as the Chairman. Members of the Sixteenth Finance Commission will be notified separately. Ritvik Ranjanam Pandey has been appointed as the Secretary to the Commission. Detailed terms of reference for the Sixteenth Finance Commission have also been outlined in the notification issued today.
The Sixteenth Finance Commission shall make recommendations on the following matters:
(i) 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.
(ii) The principles that should govern 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 purposes other than those specified in the provisos to clause (1) of that article.
(iii) The measures needed to augment the Consolidated Fund of a State to supplement the resources of the Panchayats and Municipalities in the State based on the recommendations made by the Finance Commission of the State.
The Sixteenth Finance Commission may review the current arrangements for financing Disaster Management initiatives, with reference to the funds constituted under the Disaster Management Act, 2005 (53 of 2005), and make appropriate recommendations.
The Sixteenth Finance Commission has been requested to make its report available by the 31st day of October 2025, covering a period of five years commencing on the 1st day of April 2026.