Finance Commission - Business Outrank

Although the Finance Commission plays a very important role in formulation of fiscal policies of India, there are concerns regarding the transparency of the Commission. Fiscal transparency which guarantees the public access to financial information and decision making processes is a pre-requisite for systemic stability. The Finance Commission which is constituted every five years recommends tax transfers from the Union to the states but does so without much fanfare. The process is carried out internally and is not open to the public. The absence of a single portal that contains all the information also adds to this problem. Although each Commission develops a large number of statistics, the information is not collected and made available to the public in one place. This was recently confirmed by Professor Arvind Panagariya, the Chairman of the 16th Finance Commission who advocated for the creation of a data bank which other experts also welcomed. The Fourteenth Finance Commission also recognized the problem of reconciling the scope of the review with the need for clarity of documentation. For example, Indira Rajaraman and others have for a long time now complained of the lack of clarity in regard to tax sharing formulae. The transitions from one commission to another are often times made without much explanation which makes it difficult to determine the effectiveness and fairness of the changes that have been made. Moreover, the total costs of any given Finance Commission, including both central and state costs, are not disclosed to the public. M Govinda Rao has also previously stressed on the need for more transparency in the deliberations on equity and efficiency aspects. The current debate on fiscal transparency in India can be traced back to 1998 after the East Asian financial crisis. India is a signatory to the IMF’s Codes of Good Practices; nevertheless, there are problems with regard to state-level fiscal disclosure. The 16th Finance Commission has to address issues of transparency in tax sharing formulas and therefore, establish a permanent data portal to enhance access. Opening the fiscal policy is important for increasing the trust and stability of the financial system.

What's Hot

Narayanam Nageswara Rao Outlines NCS Sugars’ Roadmap for Modernisation and Efficiency in Sugar Production

Apple and Google Face New UK Commitments on App Fairness

SBI Launches CHAKRA to Fund ₹100 Trn Sunrise Sectors

Virus Susceptibility in Species: Study Reveals Surprising Findings

Effective Yoga Poses to Naturally Manage Blood Sugar Levels

Health Budgets Of States Fall Below 8%, Missing National Health Policy Targets

Priyanka Chopra’s Stunning Desi Look Steals the Spotlight at Her Brother’s Wedding Festivities

Jana Nayagan: Vijay Wields a Whip in Stunning 2nd Look Poster, Thrilling Fans

Assam’s Jatin Goswami Honored with Padma Bhushan for Sattriya Legacy

Vijay Vikram Singh Urgently Appeals for Respect Amidst Intense Backlash from Rajat Dalal Fans: ‘I Am Not Bigg Boss

Hindon: Incredible Air India Express Flights to Start from March 1 with Low Fares

Indian government approves Singapore Airlines bid to merge Vistara and Air India

Independence Day and Raksha Bandhan Fuel Airbnb Travel Rush

Virus Susceptibility in Species: Study Reveals Surprising Findings

Hindon: Incredible Air India Express Flights to Start from March 1 with Low Fares

Bachchan’s ₹83 Crore Duplex Sale Sparks Unbelievable Investment Growth

Kartik Aaryan’s Fitness Secret: How He Achieved a Stunning Transformation

Browsing: Finance Commission

Finance Commission’s Transparency Issues Demand Urgent Attention

Narayanam Nageswara Rao Outlines NCS Sugars’ Roadmap for Modernisation and Efficiency in Sugar Production

Apple and Google Face New UK Commitments on App Fairness

SBI Launches CHAKRA to Fund ₹100 Trn Sunrise Sectors

Bank Credit Growth Slows to 13%, Deposits Ease to 10.6%

Our Picks

Narayanam Nageswara Rao Outlines NCS Sugars’ Roadmap for Modernisation and Efficiency in Sugar Production

Apple and Google Face New UK Commitments on App Fairness

SBI Launches CHAKRA to Fund ₹100 Trn Sunrise Sectors

Most Popular

Narayanam Nageswara Rao Outlines NCS Sugars’ Roadmap for Modernisation and Efficiency in Sugar Production

Top 10 World Best Business Opportunities In The World

Shaping The Future: Unmasking the energetic universe of innovative Startups

Subscribe to Updates

What's Hot

Browsing: Finance Commission