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The primary function of the Finance Commission in India is to recommend:
distribution of plan funds between the Centre and the State
to the President on financial matters
allocation of funds to various Ministries of the Union and State Governments
distribution of non-plan funds from the Centre to States
Exp:- Functions
Distribution of net proceeds of taxes between Center and the States, to be divided as per their respective contributions to the taxes.
Determine factors governing Grants-in Aid to the states and the magnitude of the same.
To make recommendations to president as to the measures needed to augment the Fund of a State to supplement the resources of the panchayats and municipalities in the state on the basis of the recommendations made by the Finance Commission of the state.
any other matter related to it by the president in the interest of sound finance
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