Pakistan Institute of Development Economics

The 7th Nfc Award: An Evaluation
Publication Year : 2012

Pakistan Is A Federal Country With Two Constitutional Tiers Of The Government—The Federal Government And The Provincial Governments; Moreover There Are Some Federally Administered Tribal Areas (Fata) And The State Of Azad Kashmir. As In Many Other Countries, The Federal Government In Pakistan Generates More Revenues Than Its Needs. Correspondingly, The Provinces Generate Only A Small Percentage Of The Revenue Required To Meet Their Expenditure Needs. This Calls For Transfers From The Federal Government To Allow The Provinces To Carry Out Their Functional Responsibilities. The National Finance Commission Is The Institution Responsible For Devising The Revenue Sharing Arrangement Between The Federal Government And The Provinces. The Commission Recommends The Sharing Of The Federal Revenue With The Four Provinces Namely Punjab, Sindh, Khyber Pakhtunkhwa And The Balochistan.1 The Commission Is Constituted Every Five Years And Has Representation (Official As Well As Non-Governmental) From All The Stakeholders. The Commission Does Not Have A Permanent Existence However It Is Allowed Adequate Time To Work On The Award (I.E., Announcement Of Revenue Sharing Arrangement).

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