Haryana Constitutes 7th State Finance Commission to Boost Local Governance Finances

The Haryana Government has constituted the Seventh State Finance Commission. A notification to this effect was issued by Chief Secretary Anurag Rastogi on Saturday.

According to the official announcement, former Chief Secretary Sanjeev Kaushal has been appointed as the Chairman of the newly formed commission. Anshaj Singh, a serving IAS officer, will act as the Member Secretary.

The commission has been tasked with examining and recommending the distribution of the state’s financial resources between the Government of Haryana and local self-governing institutions—namely Panchayati Raj Institutions (PRIs) and Urban Local Bodies (ULBs).

The core purpose of the commission is to recommend key fiscal policies aimed at empowering PRIs, which include zila parishads, panchayat samitis, and gram panchayats, along with municipal bodies. It will outline principles for distributing the net proceeds of state taxes, duties, tolls, and fees. The panel will also advise on taxes and fees that may be assigned to or collected by local bodies, as well as propose grants-in-aid from the Consolidated Fund of the State.

In addition to rural bodies, the commission will offer detailed recommendations for municipalities. These include suggestions on sharing tax revenue, assigning taxation powers, designing a grant structure, and proposing strategies to ensure the long-term financial sustainability of urban local bodies.

While framing its proposals, the commission is required to assess several critical financial parameters. These include the state’s overall receipts and expenditures, the fiscal space available for capital investments, and existing liabilities such as civic infrastructure, recurring costs of public schemes, and administrative expenses.

The financial health, revenue-generating capacity, and expenditure efficiency of PRIs and ULBs will also be thoroughly evaluated. The goal is to boost their ability to operate autonomously and manage their finances more effectively.

The Seventh Finance Commission has been asked to submit its final report by March 31, 2026. Its recommendations will cover a five-year period, from 2026–27 to 2030–31, and are expected to play a pivotal role in shaping the fiscal framework for local governance across Haryana.

Notably, Kaushal, who retired from active service on July 31, 2024, was previously appointed Chairman of the Haryana Power Generation Corporation Limited before taking up this new constitutional responsibility.