The government has now announced the appointment of three full-time members and one part-time member of the Commission.Ajay Narayan Jha, Annie George Mathew, and Niranjan Rajadhyaksha have been appointed as full-time members, while Soumya Kanti Ghosh has been appointed as a part-time member. 

Jha, who has served in previous Finance Commissions, was also a member of the 15th Finance Commission. The Commission’s main role is to decide the tax sharing formula between the Centre and the states. The 16th Finance Commission is expected to submit its recommendations by October 31, 2025, covering a five-year award period starting from April 1, 2026.

 In November, the Union Cabinet approved the Terms of Reference for the Commission, which outline its responsibilities regarding tax distribution and grants-in-aid for the states. 

Finance Secretary TV Somanathan stated that the Terms of Reference are comprehensive and have been prepared after consulting with the states.

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