---
title: "Post-Devolution Revenue Deficit Grants Explained"
description: "Post-Devolution Revenue Deficit Grants are transfers recommended by India's Finance Commission to support states with revenue shortfalls after tax devolution."
url: "https://modeldiplomat.com/learn/glossary/revenue-deficit-grants"
---

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Model Diplomat Research Team · Last reviewed June 22, 2026

TL;DR

- Post-Devolution Revenue Deficit Grants are constitutional transfers India's Finance Commission recommends to states whose assessed expenditure exceeds revenue even after their share of central taxes.
- How does the Finance Commission decide which states get post-devolution revenue deficit grants?
- What is the difference between tax devolution and a post-devolution revenue deficit grant?
- Why do these grants decline over a Finance Commission's award period?
- Are post-devolution revenue deficit grants tied to specific uses?

[Civil Service & Diplomatic Exams](https://modeldiplomat.com/learn/civil-services/glossary)Updated June 22, 2026

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In its 2021 report, the Fifteenth Finance Commission of India recommended ₹2,94,514 crore in post-devolution revenue deficit grants to seventeen states for 2021–26, with Kerala, Punjab and West Bengal among the largest recipients.

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