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Q: What is the main role of the State Finance Commission?
  • A. The distribution and determination of the net proceeds of taxes, tolls and fees between the state and local bodies.
  • B. To advice the government on the legal financial matters referred to it by the President.
  • C. To secure the accountability of the executive to the Parliament in the sphere of financial administration.
  • D. To look after the elections of the Panchayats and municipalities and also provide fund for their elections.
Correct Answer: Option A - The State Finance Commission is a constitutional body, formed under the 73ʳᵈ and 74ᵗʰ Constitutional Amendment Act 1992. In terms of Article 243(I) and 243(Y) of the Constitution, the main role of the State Finance Commission is the distribution and determination of the net proceeds of taxes, tolls and fees between the State and local bodies.
A. The State Finance Commission is a constitutional body, formed under the 73ʳᵈ and 74ᵗʰ Constitutional Amendment Act 1992. In terms of Article 243(I) and 243(Y) of the Constitution, the main role of the State Finance Commission is the distribution and determination of the net proceeds of taxes, tolls and fees between the State and local bodies.

Explanations:

The State Finance Commission is a constitutional body, formed under the 73ʳᵈ and 74ᵗʰ Constitutional Amendment Act 1992. In terms of Article 243(I) and 243(Y) of the Constitution, the main role of the State Finance Commission is the distribution and determination of the net proceeds of taxes, tolls and fees between the State and local bodies.