Question

The recommendation of the 14^th Finance Commission for increase the share of net proceeds of union taxes between centre to states has been fixed at
1. 32 percent
2. 37 percent
3. 42 percent
4. 41 percent

Answer 1

Correct Answer - Option 3 : 42 percent

The correct answer is 42 percent.

• The 14^th Finance Commission of India is constituted in the chairmanship of the former RBI governor Mr. Y.V. Reddy for the period of April 1, 2015, to March 31, 2020.
• It has recommended a record 10% increase in the states' share in the Union taxes to 42% as compared to the 13th Finance Commission.
• The total devolution to states during the five years (2015-20) period will be Rs 39.48 lakh crore.
• Uttar Pradesh (17.959%) has the biggest share in the taxes of the union government followed by Bihar (9.665%) and Madhya Pradesh (7.548%).
• Sikkim (0.367%) has the lowest share in the taxes of the union government.

• Now the 15^th Finance Commission has been set up under the chairmanship of N.K. Singh. He has submitted his annual report for 2020-21.