Thu May 29 17:25:01 UTC 2025: **Summary:**

The Tamil Nadu government has established the Seventh State Finance Commission, led by retired IAS officer K. Allaudin. This commission will assess the financial standing of urban and rural local bodies and propose recommendations on how state government funds should be distributed to them. The commission will address revenue sharing from taxes and other levies, identify potential revenue sources for local bodies, and recommend grants-in-aid. The commission is expected to deliver its report by August 31, 2026, covering the five-year period starting April 1, 2027.

**News Article:**

**Tamil Nadu Forms Seventh State Finance Commission to Bolster Local Finances**

**CHENNAI, May 29, 2025** – The Tamil Nadu government has announced the formation of the Seventh State Finance Commission, aimed at strengthening the financial health of urban and rural local bodies across the state. The commission, headed by retired IAS officer K. Allaudin, will review the financial position of these local governing bodies and provide recommendations for equitable distribution of state government funds.

The newly formed commission will focus on critical areas, including the allocation of revenue generated from taxes, duties, tolls, and fees between the state and local bodies. It will also explore potential revenue streams that can be assigned to or appropriated by urban and rural entities. Furthermore, the commission will advise on grants-in-aid to be provided from the Consolidated Fund of the State.

The commission includes Tiruppur Mayor N. Dinesh Kumar as a non-official member, along with ex-officio members representing the Director of Municipal Administration, the Commissioner of Rural Development and Panchayat Raj, and the Commissioner of Town Panchayats. IAS officer Pratik Tayal will serve as the Member-Secretary.

The commission is slated to submit its report by August 31, 2026, covering a five-year period commencing April 1, 2027. This move is anticipated to provide a significant boost to local governance by ensuring more sustainable and equitable financial resources for urban and rural development.

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