Introduction Fiscal federalism can best be understood as the economic counterpart to political federalism. It has to do with delegating functions to various levels of government and providing adequate financial resources to carry them out. Revenue distribution is particularly important in determining the character of the state's relationship with the Centre. Taxation powers are incorporated in the union list and the state list of the Constitution; both lists are exhaustive an

“Federalism is political contravene among those who desire unity without uniformity”-A.V.Dicey Federalism is a form of political structure that binds distinct polities together within a larger political framework while allowing each to retain its integrity. It is a term that refers to the constitutionally mandated division of powers between two or more levels of government in the modern nation-state system—one at the national level and another at the provincial, state, or loc