16th Finance Commission Unveils State Tax Share Report: Key Recommendations for 2026-31

The 16th Finance Commission, led by Chairman Arvind Panagariya, submitted its report to President Droupadi Murmu, detailing the distribution of states' shares in central taxes for 2026-31. The report, focusing on crucial financial relations between the Union and the states, will be presented in Parliament's upcoming Winter Session.

The 16th Finance Commission, chaired by Arvind Panagariya, has submitted its much-anticipated report to President Droupadi Murmu, outlining the sharing formula of states' shares in the central taxes from 2026 to 2031. The recommendations hold immense significance in shaping the financial relationship between the Centre and states.

The Finance Ministry confirmed that the report, due for public release during the Winter Session of Parliament starting December 1, encompasses detailed analyses and consultations with government bodies and financial experts. This process aimed at ensuring a comprehensive evaluation of the existing financial framework amid growing tensions over tax distributions.

The commission's report comprises two volumes that cover everything from tax devolution terms to disaster management funding arrangements. With previous commissions setting the percentage at 41%, the current recommendations could redefine state-Centre fiscal dynamics.

(With inputs from agencies.)