The Finance Commission (IAST: Vitta Āyoga) was established by the President of India in 1951 under Article 280 of the Indian Constitution. It was formed to define the financial relations between the central government of India and the individual state governments. The Finance Commission (Miscellaneous Provisions) Act, 1951 additionally defines the terms of qualification, appointment and disqualification, the term, eligibility and powers of the Finance Commission. As per the Constitution, the Commission is appointed every five years and consists of a chairman and four other members.
Since the institution of the First Finance Commission, stark changes in the macroeconomic situation of the Indian economy have led to major changes in the Finance Commission’s recommendations over the years.
There have been fifteen commissions to date. The most recent was constituted in 2017 and is chaired by N. K.Singh, a former member of the Planning Commission.