IndexIntroduction 3Historical Perspective 4Pre-Independence Revenue Allocation Formula 4POST-INDEPENDENCE REVENUE ALLOCATION (RAISMAN AWARD) 4REVENUE ALLOCATION UNDER A UNIT 5National Financial Committee 5National Financial Commission 1973 61st NFC Award 1974 62nd NFC Award (1979) ) 63rd NFC Award 74th NFC Award 7The 5th NFC Award 8IntroductionIn the name of Allah who is most merciful and beneficent, as we know best, Islamic republic of Pakistan is a low income federated country which includes four provinces (currently five provinces) which has federal administration. Most government revenue comes from income tax and then is distributed through the NFC revenue sharing formula between provinces, and then is redistributed from provincial to local government and from local to local. The NFC awards in Pakistan were established in 1970 and were called National Finance Committee, but when East Pakistan separated from West Pakistan in 1971, the National Finance Commission established under Article 160 in 1973 in the constitution of Pakistan, the award NFC is awarded every five years by the President of Pakistan. For equitable transfers between the federal and provincial governments. The NFC Awards extend every 5 years and the Chairman of the NFC Awards is the President of Pakistan, and the members are the provincial finance ministers and some economists selected by the President of Pakistan and are headed by the federal finance minister. There are seven National Finance Commission (NFC) awards that have been distributed among the federal and provincial governments among these seven...... middle of the paper...... It is also like a previous NFC which had no consequences and members did not provide any recommendations due to requests from its members. 7th NFC Award The 7th NFC Award of 2010 is made by the President of Islamic Republic of Pakistan and has brought some improvement and variation in the distribution criteria of the appeal and this NFC Award has been accepted the application of Baluchistan, Sindh and KPK. For the first time the distribution criteria have been changed with respect to the population in the history of the NFC awards. And this formula includes underdevelopment, poverty and reverse population density required by Baluchistan, KPK and Sindh. And it was an advance in the NFC awards. Reverse population density was requested by Baluchistan but Punjab requested population to be the main criterion because Punjab population is the highest.