1.16th Finance Commission Tenure Extended (Finance Commission)
What & Where
Finance Commission (FC): constitutional body under Article 280, formed by President to recommend Centre-State fiscal devolution
Reconstituted every five years or earlier; report laid before both Houses of Parliament
16th FC chaired by economist Arvind Panagariya; coverage period 1 Apr 2026 – 31 Mar 2031
Quick Facts for MCQs
Composition & Eligibility
- Chairman experience: public affairs per 1951 Act
- Other members: expertise as HC judge, finance & accounts, financial administration, economics
- Members hold office for period set by President; reappointment permissible
Mandated Functions
- Tax devolution: vertical and horizontal distribution criteria
- Grants-in-aid principles under Article 275
- Measures to augment resources of Panchayats and Municipalities
Timeline Updates
- Government order: tenure extended by one month to finalise recommendations
- Report submission now aligned with parliamentary winter session calendar
Key Data Points
| Feature | Data-Point |
|---|---|
| Constitutional article | Article 280 |
| Constituting authority | President of India |
| Usual periodicity | Every 5 years |
| Current commission number | 16th |
| Chairperson | Arvind Panagariya |
| Statutory member count | 1 Chairperson + 4 members |
| Extension granted | Till 30 Nov 2025 |
| Original report due | 31 Oct 2025 |
| Coverage cycle | FY 2026-27 to FY 2030-31 |
| Key law on qualifications | Finance Commission Act 1951 |
Related UPSC Prelims PYQs
Population of the year 2011 was first introduced in the tax devolution formula for sharing Union tax revenue with the States by
Which one of the following authorities recommends the principles governing grants-in-aid of the revenues to the states out of the Consolidated Fund of India?




