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Fourteenth Finance Commission - Devolutions
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In this lecture, Bhavin first discuses the recomendation of 14th finance commission regarding devolution of finances from Union to States. After this he discusses the distribution of devolved finances between States, with intresting details. Finally he explains grants offered to local bodies.

Bhavin Sangoi
BA Political Science and Psychology, Mumbai University. Teaching Polity, Economics and international relations for 7 years.

Unacademy user
nice course sir ... thanks for this
Sir..i am bit confused .....the criteria simply means that 15 rupee per 100 rupee would be given to those states which have more area.....??? Correct me if a am wrong with example and explanation.....
Nice topic picked up for lecture..
  1. Course Name: In-depth stud of Centre State Relations Lesson Name: Fourteenth Finance Commission - I Presented by Bhavin Sangoi

  2. About me B.A in Political Science & Psychology Appeared in UPSC CSE Mains Teaching Indian Polity, International Relations, economics &mental Ability since 5 years Experience of teaching for various competitive exams such as NTSE, CET & UPSC Rate, Review and Recommend Follow me on: low me on: https/Unacademy in/user/ BhavinSangoi

  3. Vertical Devolution Fourteenth Finance Commission was Constituted in 2014, under the Chairmanship of Y.V Reddy. Its award period is from 2015 -16 to 2020-21 FFC recommended that State's share in devolution of taxes from centre to state should be increased to 42% from 32%

  4. Horizontal Distribution Criteria 15% Area based 17 5% based on 1971 populatiorn 10% based based on Income gap on 2011- population 7.5% based on Forest cover

  5. Local body Grants Total grants to local bodies will be Rs 2,87,436 crore out of this Rs 2,00,292 crores should be given to Panchayats and 87,143 crore to municipalities

  6. Continued Distribution of local body grants between states should be done on the basis 90% weight to population based on 2011 census and 10% weight to area

  7. Panchayats Municipalities Basic grant 90% 80% Performance grant 10% 20%

  8. Principles for Local body Grants All the grant money should be spent on basic services Performance grant would be based on improvement in revenue and audited accounts of receipts and expenditure

  9. Miscellaneous A total revenue deficit grant of Rs 1,94,821 should be awarded to eleven states Raise the ceiling limit of p Raise the ceiling limit of profession tax from Rs 2500 per annum to Rs 12,000 per annum