A power play-the 14th Finance Commission of India, constituted in 2013 and submitting a report in 2015-drove home several significant proposals for consolidation in the fiscal framework of India. The Finance Commission is constituted by the President under article 280 of the Constitution, mainly to give its
recommendations on distribution of tax revenues between the
Union and the States and amongst the States themselves. Here are some of its primary proposals:

1. Funds Devolution: Increase share of states in the divisible pool of taxes from 32% to 42%.

2. Grant with Performance-Based Elements: Provide for performance-based grants to the states, challenging the states to perform better in their fiscal management and governance.

3. Revenue Deficit Grants: For some of the states that have more serious fiscal issues, suggest revenue deficit grants.

4. Fiscal Responsibility by States: Inculcate fiscal discipline among the states, and request them to follow the frameworks on fiscal responsibility.

5. Funding for Local Bodies: Strengthen funding to the local bodies and promote the cause of the 73rd and the 74th Amendments that advocate decentralization.

6. Health Grants Increase: Advise to raise the health and the education departments with the own financial resources for the underdeveloped states.

7. Supporting States in Managing Disasters: Establish an approach for assisting the states in case of disaster management and relief work.

8. Simplify the Tax Structure: Promote cut or reduction of the current complicated tax measures towards improving on the level of compliance while discouraging evasion and avoidance.

9. Building Tax Base: State Governments should be guided on best practices of extending the tax base through up gradation of land records and revenues.

10. Public Expenditure: It is important to recommend ways through which efficiency of expenditure can be enhanced to provide for a better result.

11. Centre Support for Programs: This may imply that some Centre programs may still need support of the Centre.

12. Incentives for Skill Development: Reward States in terms of financial spends on capacity building and vocational education.

13. Focus on Backward Areas: The concentration should continue to be on giving special input to regions that are economically downtrodden and/or not well served within the country.

14. Review of Fiscal Transfers: Consider the review of supplementary grants with regard to the premise that fiscal transfers should reflect the changes in new economic realities as well as requirements of states.