The Union Cabinet led by Prime Minister Narendra Modi on 22 November 2017 approved the setting up of the 15th Finance Commission.
The decision was a constitutional obligation under Article 280 (1) of the Constitution. The Terms of Reference for the 15th Finance Commission will be notified soon.
• According to Article 280(1) of the Constitution, a Finance Commission (FC) should be constituted within two years from the commencement of this Constitution and thereafter at the expiration of every fifth year or at such earlier time as the President considers necessary.
• The general practice has been to set up the next Finance Commission within five years of the date of setting up of the previous Finance Commission.
• Fourteen (14) Finance Commissions have been constituted in the past.
• The 14th Finance Commission was set up on 2 January 2013 to make recommendations covering the period of five years starting from 1 April 2015.
• The Commission submitted its Report on 15 December 2014.
• The recommendations of the 14th commission would be valid upto 2019-2020.
• The 15th Finance commission would be making recommendations for a period of five years starting from 1 April 2020.
Who: Union Cabinet
When: 22 November 2017