India, Feb. 3 -- The 16th Finance Commission has revised the tax devolution formula to include open forests, assigning different weights to forest densities.

This change aims to incentivise states to expand forest cover, with rewards for increasing forest areas.

The adjustments also address cost disabilities in hilly regions, promoting ecological management and disaster risk mitigation.

The 16th Finance Commission has tweaked the horizontal tax devolution formula under the forest criterion, which now includes open forests and assigns different weights based on forest density.

The Commission's report was submitted to Parliament on February 1, 2026. It highlights the allocation of weightage to a state's share of the total forest area as...