GK question and answer on Indian Economy 14th Finance Commission
The Finance Commission is a constitutional body which is set up to recommend the central government to share the tax collection with the state governments. In this article, 10 questions related to this 14th Finance Commission are made which will be very useful for examinations like IAS, PCS, SSC etc.
1. Who establishes the Finance Commission in India?
(B) Finance Minister
(D) Governor of Reserve Bank of India
2. How many Finance Commissions have been constituted so far?
Explanation: So far 14 Finance Commission has been constituted.
3. Which of the following statements is not correct?
(A) The first finance commission was constituted in 1951
(B) Chairman of the First Finance Commission was Mr. Santhanam
(C) The Chairman of the 12th Finance Commission was C. Rangarajan
(D) B and C
Explanation: Chairman of the First Finance Commission was K.C. Niyogi.
4. Which of the following article talks about the formation of the Finance Commission?
(A) Article 280
(B) Article 275
(C) Article 148
(D) Article 176
Explanation: Article 280
5. Who is the Chairman of the 14th Finance Commission?
(A) Vijay Kelkar
(B) Y.V. Reddy
(C) Arun Kumar Mathur
(D) Nandan Nilakani
Explanation: Y.V. Reddy
6. Which statement about the 14th Finance Commission is not correct?
(A) The 14th Finance Commission has a tenure of 2015-2020
(B) It has recommended 42% share to states in tax collection of Central government
(C) The highest tax component of the tax collection is given to Maharashtra
(D) Jammu and Kashmir has been given 1.85% of the total taxes.
Explanation: The highest tax share (17.95%) is given to Uttar Pradesh.
7. Which factor got the highest priority in tax distribution to the states?
(A) State's population
(B) Income inequality in the state
(C) Area of the state
(D) Forest area in the state
Explanation: Income inequality in the states got 50% weightage in the tax distribution and population got 17.5% weightage.
8. Which year's population level is considered by the 14th Finance Commission while deciding the share of states?
Explanation: The population of 1971 has been considered as the basis for tax distribution.
9. Which of the following states got the highest share in taxes by the 14th Finance Commission recommendation?
(B) Uttar Pradesh
(D) Madhya Pradesh
Explanation: Uttar Pradesh
10. Which factor has not been kept in mind by the Finance Commission for giving a share of taxes to states?
(A) Demographic changes in the state
(B) forest area in the state
(C) Income inequality in the state
(D) Level of education in the state
Explanation: Level of education in the state