|Which of the following statement(s) is/are not true about the 14th Finance Commission of India|
|1. Its recommendation states share in net proceeds from union tax collection to be increased 42% from 32% earlier which is the largest change ever in the percentage of devolution.|
|2. It is constituted for a period of 2015-2020 under the Chairmanship of Dr Yaga Venugopal Reddy, former Governor of the Reserve Bank of India.|
|3. It recommended to create an autonomous and independent 'GST Compensation Fund' to facilitate: compensation process and 'Fiscal Council' to undertake ex-ante assessment of fiscal policy implication of budget proposals.|
|4. It also recommended for distribution of grants to states for local bodies using 2011 population data weight of 10 per cent and area with weight of 90 per cent.|
|Which of the statement(s) given above is/are incorrect?|
A) 1 and 3
B) 1 and 4
C) Only 4
D) None of these
Correct Answer: C
Solution :[c] The 14th Finance Commission of India was constituted on 2nd January, 2013 for a period of 2015-2020 under the Chairmanship of former RBI Governor. Yaga Venugopal Reddy under Article 280 by President of India and it submitted its report on 15th December, 2014. Its major recommendations are as follow. States share in the net proceeds of union tax revenues increased to 42% from 32% earlier. Create an autonomous and independent GST Compensation Fund through legislative actions to facilitate the compensation process. Establish an independent 'Fiscal Council' to undertake ex-ante assessment of fiscal policy implication of budget proposal and their consistency with fiscal policy and rules. Distribution of grants to states for local bodies based in 2011 population data (90 % weight) and area (10% weight). Suitably Amend Electricity Act, 2003 to facilitate levy of penalties for delays in payment of subsidies by the State Governments. The sharing pattern in respects of various Centrally Sponsored Schemes (CSS) need to be changed. The commission wants the states to share a greater fiscal responsibility for the implementation of such schemes. Grants to states should be divided into two Grant to duly constituted Gram Panchayats. Grant to duly constituted Municipal bodies.
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