16th Finance Commission Hands Over 2026-31 Report To President Murmu

The 16th Finance Commission, led by Dr Arvind Panagariya, on Monday submitted its report for the 2026-31 period to President Droupadi Murmu.

The meeting marked the formal completion of the Commission’s mandate. The mandate recommends how taxes should be shared between the Centre and the states. It covers the five financial years beginning April 1, 2026.

The government had constituted the Commission on December 31, 2023, appointing former NITI Aayog vice-chairman Dr Panagariya as Chairman.

The panel consists of four members. Secretary Ritvik Pandey, two joint secretaries and one economic advisor support their work.

The Commission was expected to submit its report by October 31. The Centre extended its tenure by one month and allowed completion by November 30.

The President’s office confirmed the submission on X, noting that the Chairman and members called on President Murmu to present the final document.

The Commission’s recommendations will shape fiscal federal relations for 2026-31. They will also influence the vertical and horizontal distribution of taxes.

Its report will guide how resources flow from the Union government to the states over the next five years.

Meanwhile, the Centre recently released an additional tax devolution of ₹1,01,603 crore to states ahead of the festive season.

The government said the funds would help states speed up capital expenditure and support development and welfare initiatives.

Uttar Pradesh received the largest share at ₹18,227 crore, followed by Bihar with ₹10,219 crore.

Madhya Pradesh received ₹7,976 crore; West Bengal, ₹7,644 crore; Maharashtra, ₹6,418 crore; and Rajasthan, ₹6,123 crore.

Andhra Pradesh (₹4,112 crore), Odisha (₹4,601 crore), Tamil Nadu (₹4,144 crore), Karnataka (₹3,705 crore) and Jharkhand (₹3,360 crore) also saw significant allocations.

The Finance Ministry had earlier reported that the Centre transferred ₹4,28,544 crore to states as their share of taxes during April-July.

This amount was ₹61,914 crore higher than the corresponding period last year.

During the same period, the Central government collected ₹10,95,209 crore in revenue, amounting to 31.3% of the budget estimates for 2025-26.

The submission of the 16th Finance Commission’s report now sets the stage for the Centre to review and deliberate on its recommendations.

It also prepares the government to implement these recommendations ahead of the next fiscal cycle.

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