Prelims 2025 · Polity and Constitution · Question 76
Which of the following statements with regard to recommendations of the 15th Finance Commission of India are correct? I. It has recommended grants of Rs.4,800 crores from the year 2022-23 to the year 2025-26 for incentivizing States to enhance educational outcomes. II. 45% of the net proceeds of Union taxes are to be shared with States. III. Rs.45,000 crores are to be kept as performance-based incentive for all States for carrying out agricultural reforms. IV. It reintroduced tax effort criteria to reward fiscal performance. Select the correct answer using the code given below.
Answer
I, III and IV
I. Correct. The 15th Finance Commission recommended ₹4,800 crore as sector-specific grants for education for 2022-23 to 2025-26 to improve educational outcomes.
II. Incorrect. The Commission recommended that 41%, not 45%, of the net proceeds of Union taxes be shared with States.
III. Correct. It recommended ₹45,000 crore as a performance-based incentive for States to undertake agricultural reforms.
IV. Correct. The 15th Finance Commission reintroduced the tax effort criterion in horizontal devolution to reward better fiscal performance.
Hence, the correct statements are I, III and IV.