The commission that recommends what Kerala's panchayats and municipalities get from State taxes

Background

The body that recommends how much of Kerala's tax revenue goes to its panchayats and municipalities is the State Finance Commission, which the State constitutes under Article 243-I and Article 243-Y of the Constitution of India to review the financial position of the Panchayats and the Municipalities. The Kerala Panchayat Raj Act was passed as early as in 1994, and the first State Finance Commission was constituted immediately after that. The first Commission's award covered the five years from 1996. Kerala has since constituted its Commissions without any break; the Seventh State Finance Commission was constituted in 2024 and its award covers the five-year block that opens in 2026. Kerala was the first State to set up a Cell in the Secretariat to follow up the implementation of the recommendations, in 1997. The Commission's own account says that panchayats in Kerala have transformed into the third stratum of government.