What is the National Finance Commission?

National Finance Commission (NFC) is a body that is written in the constitution of Pakistan that is responsible for managing financial resources between the Federal Government and the provinces. Established as per Article 160 of the Constitution of Pakistan, NFC ensures a just and good division of the revenues which are collected through different types of taxes, for example, income tax, sales tax and customs duties.

The major purpose of the NFC is to rectify the economic imbalances and promote equity in resource allocation throughout the provinces, these factors include population, poverty, and underdevelopment. The commission meets and re-examines the formula for resource distribution periodically in line with the ideal of fiscal synchronization and collaboration between the center and the provinces.