Article 280
The Finance Commission
Article 280 of the Constitution requires the President to constitute a Finance Commission every five years (or earlier if necessary), consisting of a Chairman and four other members. Its principal task is to recommend how the net proceeds of Union taxes should be distributed between the Centre and the states (vertical devolution) and among the states themselves (horizontal devolution), along with principles governing grants-in-aid under Article 275.
- Parliament prescribes the qualifications and manner of selection of Commission members
- The 16th Finance Commission, chaired by Arvind Panagariya, covers the award period 2026-27 to 2030-31, with recommendations effective from April 1, 2026
- The 16th Finance Commission retained the vertical devolution share at 41% of the divisible pool, unchanged from the 15th Finance Commission's recommendation
- Horizontal devolution criteria used by recent Finance Commissions include income distance, population (2011 Census), area, forest and ecology, demographic performance, and tax effort
● Tracked since February 11, 2026 · last seen August 06, 2026 · updates as the daily brief publishes
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