Who determines the centre - state financial relations from the following?

The correct answer is the Finance Commission.

Key Points

• Article 280 of the Indian Constitution provides for a Finance Commission as a quasi-judicial body.
• It is constituted by the President of India every fifth year or at such an earlier time as he considers necessary.
• It is set up to define the financial relations between the central government of India and the individual state governments.
• It is required to make recommendations to the President of India on the following matters - 
  • The distribution of the net process of taxes to be shared between centers and the states and the allocation between the states of the respective shares of such proceeds.
  • the principle that should govern grants-in-aid to the states by the Centre.
  • The measures needed to Consolidated Fund of State to supplement the resource of the panchayats and the municipalities on the basis of the recommendation of the State Finance Commission.
  • Any other matter referred by the resident in the interest of sound finance.
• The Finance Commission consists of a chairman and four other members to be appointed by the President.
  • They hold office for such a period as specified by the President in his order.
  • They are eligible for reappointment.