Which body recommends the distribution of taxes between Center and States?
Show answer & explanation
Correct answer: B
Explanation
Correct Answer:-
Finance Commission
Explanation:-
The 'Finance Commission', constituted under Article 280 of the Indian Constitution, is a constitutional body whose primary function is to recommend the distribution of net proceeds of taxes between the Center and the States. This commission also determines the principles for the allocation of these taxes among the states and the 'grants-in-aid' to be provided to the states to ensure financial balance in the country.
Key Points:-
The Finance Commission is constituted by the President of India every five years or earlier as needed.
The commission consists of a Chairperson and four other members, appointed by the President.
NITI Aayog or the Planning Commission (which is now defunct) has no constitutional role in the distribution of financial resources; their primary function is to provide policy advice and planning.
Important Questions and Answers:
Question: Which Finance Commission is currently operational?
Answer: 16th Finance Commission (as of 2026).
Question: When was the first Finance Commission of India constituted?
Answer: In 1951.