The Kerala State Cabinet on 11 September cleared a proposal to constitute the 7th State Finance Commission. Former Kerala State Planning Board member K.N. Harilal will chair the panel.
- With a two-year term, the Commission will study the fiscal position of local bodies and recommend policies and measures for strengthening their finances.
- It will also submit recommendations regarding the taxes, duties, tolls and fees that may be assigned to, or appropriated by, the panchayats and the municipalities.
- State Finance Commissions are constituted by the State Government under clause 1 of Article 243 (I) and (Y) of the Constitution.
- These provisions were added in the constitution by the 73rd amendment relating to Panchayati Raj Institutions, and the 74th to Municipalities in 1992.
- As per the constitution, the State Finance Commission(SFC) will be appointed after every 5 years, to recommend devolution of funds from the State Government to Local Bodies, and also suggest measures for augmenting their Own Resources.
