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The Finance Commission is a constitutional body to provide suggestions on centre-state financial relations. The Finance Commission is constituted by the President under Article 280 of the Constitution.
The 16th Finance Commission headed by Arvind Panagariya was on a three-day visit to Kerala in December 2024 as part of preparing the study report
The Kerala government this time adopted a 'give and take' strategy.
Kerala wants the vertical devolution of funds to be increased from 41% to 50%.
These funds are for all the 14 eligible district panchayats, 152 block panchayats and 941 gram panchayats.
Kerala hosted the first Conclave of Finance Ministers to thrash out ways to secure from the 16th Finance Commission the fair demands of states suffering under what has been termed as the fiscal authoritarianism of the Centre.
To make up for the shortage caused by the growing proportion of cesses and surcharges, both the Kerala and TN finance ministers urged the 16th FC to scale up the share of states in devolution to 50%.
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