Which of the following are the role of Finance Commissions in India ? I. To make recommendations on the…
Under Article 280(3), the Finance Commission recommends the distribution of the net proceeds of taxes between the Union and the States, and the principles governing…
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Which of the following are the role of Finance Commissions in India ?
I. To make recommendations on the distribution of tax proceeds between Centre and States.
II. To make Recommendations on levying, removing or restructuring of taxes.
III. To recommend Grants-in-aid under Article 275 of the Constitution
IV. To recommend plan and other grants under Article 282 of the Constitution
Answer and explanation
Correct answer B
Under Article 280(3), the Finance Commission recommends the distribution of the net proceeds of taxes between the Union and the States, and the principles governing grants-in-aid to States out of the Consolidated Fund of India under Article 275. Recommending the levy, removal or restructuring of taxes is not one of its functions. Grants under Article 282 are discretionary grants made by the Union directly, formerly through the Planning Commission, not on the Finance Commission's advice.
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UGC NET Economics