Q1. Discuss the structure, powers and functions of the State Finance Commission.
- State Finance Commission (SFC) is a constitutional body under Articles 243I and 243Y.
- The Governor constitutes the SFC every five years to review local bodies' financial position.
- SFC recommends principles for distributing state taxes between the state and local bodies (Panchayats/Municipalities).
- It advises on allocating tax proceeds among different levels of Panchayats and Municipalities.
Answer: The State Finance Commission (SFC) is a crucial constitutional body established in India to address the financial decentralization and resource allocation for local self-governing bodies – Panchayats and Municipalities. Its existence stems from Article 243I and Article 243Y of the Indian Constitution, inserted by the 73rd and 74th Constitutional Amendment Acts respectively. **Structure of the State Finance Commission** The SFC is constituted by the Governor of a State every five years. The Go...