The Commission is yet to complete all its state visits to get crucial feedback from state governments and local bodies. Further, the new government at the Centre after the General Elections may want to seek its advice on some more issues that would have to be accommodated, said two officials close to the development.
At least, a three month extension is likely to be sought so that the report can be submitted by December 31 this year or latest by January 2015, said the officials.
But the delay would still give the Centre enough time to review the report and reflect its recommendations in the Union Budget next year. The recommendations of the Fourteenth Finance Commission would be applicable for the five-year period commencing from April 1, 2015. Traditionally, the finance panel submits its report to the President, which is then approved by the Union Cabinet and tabled in Parliament.
The Finance Commission, which is a Constitutional body, is set up every five years to recommend sharing of tax proceeds between the Centre and the state. Since its work includes a comprehensive understanding of the finances of the Centre as well as state governments, the Commission tends to visit almost all states and meet local bodies to understand their demands before working out a revenue sharing formula.
The Fourteenth Finance Commission that was set up in January 2013, has till now visited 19 states including Haryana, Punjab and West Bengal. On Wednesday, it visited Goa and met chief minister Manohar Parrikar.
Apart from the revenue sharing formula between the Centre and the states, the terms of reference for the Fourteenth Finance Commission include recommending measures for pricing of public utilities such as electricity and water in an independent manner and also examining issues like disinvestment, GST compensation, sale of non-priority PSUs and subsidies.
Earlier, the Thirteenth Finance Commission, which was led by former finance secretary Vijay Kelkar had also sought a similar extension of three months. Instead of its original deadline of October 31, 2009, the panel had submitted its report on December 30, 2009.
Panel headed by YV Reddy
* The delay will give the Centre enough time to review the report and reflect its recommendations in the Union Budget next year
* The recommendations of the Fourteenth Finance Commission would be applicable for the five-year period commencing from April 1, 2015
* Traditionally, the Finance Commission submits its
report to the President, which is then approved by the Union Cabinet and tabled in Parliament