**Policy Summary: 15th Finance Commission Recommendations - FY 2024-25**
This document summarizes the Government of India's response to questions raised in Lok Sabha regarding the implementation of the 15th Finance Commission's recommendations for Fiscal Year 2024-25.
**Key Findings:**
* **States' Share of Central Taxes:** The total amount allocated to States from the net proceeds of shareable central taxes for FY 2024-25 is ₹12,86,885.44 crore. This allocation aligns with the accepted recommendations of the 15th Finance Commission.
* **Devolution to Local Bodies:** The Central Government does not directly devolve tax revenue to local bodies. Instead, grants are released to State Governments based on the Finance Commission's recommendations.
* **State-Specific Grants:** No state-specific grants, as initially suggested by the 15th Finance Commission, were accepted in the Explanatory Memorandum. Consequently, no state-specific grants under the 15th Finance Commission recommendations are being released.
Key Entities Referenced
15th Finance Commission: The Fifteenth Finance Commission of India, a constitutional body that recommends measures for revenue distribution between the Union and State Governments.
FY 2024-25: Financial Year 2024-2025, the fiscal year under discussion for the devolution of funds.
Central Taxes: Taxes collected by the Central Government that are shareable with the States.
States: Refers to the various State Governments within India that receive a share of central taxes.
Pankaj Chaudhary: The Minister of State in the Ministry of Finance, who provided the answer to the parliamentary question.
Local bodies: Local governing bodies in urban and rural areas that receive grants through State Governments.
Ministry of Finance: The Indian Government Ministry responsible for financial matters, including tax devolution.
Lok Sabha: The Lower House of the Parliament of India, where the unstarred question was raised.
GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF ECONOMIC AFFAIRS
LOK SABHA
UNSTARRED QUESTION NO. 4056
TO BE ANSWERED ON MONDAY, THE 18th AUGUST, 2025
SRAVANA 27, 1947 (SAKA)
RECOMMENDATIONS OF THE 15TH FINANCE COMMISSION
4056. SHRI RAMASAHAYAM RAGHURAM REDDY:
Will the Minister of FINANCE be pleased to state:
a) the States share of the net proceeds of shareable Central Taxes for FY 2024-25;
b) whether the said share is below 41% as suggested by the 15th Finance Commission and whether
the Government plans to enhance devolution of States share to the aforesaid level;
c) the level of devolution made by the Centre to local bodies in urban and rural areas;
d) whether the said share is below Rs. 4.36 lakh crore and the Government plans to enhance
devolution of States share to the aforesaid level;
e) the details of State-specific grants made in FY 2024-25; and
f) whether the said share is below the Rs. 49,599 crore as suggested by the 15th Finance
Commission and whether the Government plans to enhance devolution of States' share to the
aforesaid level?
ANSWER
THE MINISTER OF STATE IN THE MINISTRY OF FINANCE
(SHRI PANKAJ CHAUDHARY)
(a): The total amount of States’ share of the net proceeds of shareable taxes & duties for FY
2024-25 is ₹12,86,885.44 crore.
(b): No sir, the said share is as per the accepted recommendation of 15th Finance Commission.
(c) to (d): The Central Government doesn’t devolve any tax to local bodies. However, the Central
Government releases local body grants to State Governments based on recommendations of Finance
Commission.
(e) to (f): No State-specific grants were specifically accepted in the Explanatory Memorandum as
to the action taken on the recommendations made by the Fifteenth Finance Commission.
Accordingly, no state-specific grants under 15th FC recommendations are being released.
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