Full Form of SFC

What is SFC?

The State Finance Commission (SFC) is a constitutional body established under Article 243-I of the Indian Constitution for every state. It is constituted by the Governor to review the financial position of Panchayats and Municipalities within the state and recommend principles for distributing the net proceeds of taxes, duties, tolls, and fees collected by the state government between the state and local bodies. The SFC also suggests measures to augment the consolidated fund of the states in order to supplement the resources of Panchayats and Municipalities. The commission is set up every five years, and its recommendations are crucial for strengthening grassroots-level democracy and fiscal federalism in India. The SFC plays a vital role in determining the devolution of financial resources to rural local bodies and urban local bodies, directly impacting the planning and execution of welfare schemes at village and city levels. For competitive exams like UPSC, State PSC, and SSC, the State Finance Commission is a highly important topic under Indian Polity and Panchayati Raj, frequently appearing in both prelims and mains.

SFC का फुल फॉर्म

Example

The State Finance Commission of Maharashtra recently submitted its report recommending a significant increase in the share of state taxes devolved to municipal corporations across the state.

SFC — frequently asked questions

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