WBCS.LIVE practice question

Which of the following institutions of India is the chief advisory body on the distribution of tax revenue between the Centre and the States?

Solve this multiple-choice question and check the correct answer with its explanation below.

Answer options

  1. The Planning Commission
  2. The Finance Commission
  3. The Lok Sabha
  4. The Rajya Sabha

Correct answer and explanation

Correct answer: The Finance Commission

Explanation: āœ… Correct Answer: B) The Finance Commission šŸ“š Explanation: The Finance Commission is a constitutional body established under Article 280 to recommend the distribution of net tax proceeds between the Union and the States. It also advises on the principles that should govern the grants-in-aid to the states. It plays a crucial role in maintaining fiscal federalism in India.