September 17, 2009

The government on Thursday extended the term of the Thirteenth Finance Commission (TFC) by three months up to 31 January 2010, and asked it to submit its report by December.The Commission, headed by former finance secretary Vijay Kelkar, was earlier required to submit its report by 31 October.The commission had sought an extension as it could not complete its deliberations on account of the general elections to the 15th Lok Sabha and assembly polls, information and broadcasting minister Ambika Soni told reporters after a Cabinet meeting.

Soni said the TFC has been asked to submit its report by December so that government could give effect to its recommendations in the Budget for 2010-11.The Commission, appointed in November 2007, would submit its recommendations on sharing of tax proceeds between the centre and the states.The government has also asked the Commission to look into the issues of fiscal consolidation, which has become necessary in view of rising public expenditure to combat the impact of global financial meltdown.