15th Finance Commission

Recently Fifteenth Finance Commission (XVFC) led by Chairman N K Singh, submitted its Report for the period 2021-22 to 2025-26 to the President of India.
As per the terms of reference (ToR), the Commission was mandated to give its recommendations for five years from 2021-22 to 2025-26 by 30 October, 2020.
The Report will be available in the public domain once it is tabled in the Parliament by the Union Government.
The Commission was asked to give its recommendations on many unique and wide-ranging issues in its terms of reference.

Apart from the vertical and horizontal tax devolution, local government grants, disaster management grant, the Commission was also asked to examine and recommend performance incentives for States in many areas like power sector, adoption of DBT, solid waste management etc.
The Commission was also asked to examine whether a separate mechanism for funding of defence and internal security ought to be set up and if so how such a mechanism could be operationalised.
Highlights of the Report are as follows
Its main recommendations are for the devolution of funds between the Centre and the States for the period 2021-22 to 2025-26.
The Commission has also addressed all its unique terms of reference such as considering a new non-lapsable fund for financing national security and defence spending, and offering performance incentives for States that deliver on reforms.
Apart from the main report uniquely titled “Finance Commission in Covid Times” which depicts a set of scales on its cover to denote balance between the Union and the States.
The panel has come up with State-specific considerations to address the key challenges that individual States face.