The Finance Commission MCQ Quiz tests your knowledge on the most important topics in finance. By taking this quiz, you will be able to improve your understanding of the subject and be better prepared for exams.
Question 1: Which one of the following authorities recommends the Principles governing the grants-in aid of the revenues to the States out of the Consolidated Fund of India?
(A) Finance Commission
(B) Inter-State Council
(C) Union Ministry of Finance
(D) Public Accounts Committee
Question 2: Who was the Chairman of the Twelfth Finance Commission?
(A) A.M. Khusro
(B) K.C. Pant
(C) Montek Singh
(D) C. Rangarajan
Question 3: Which one of the following institutions will lay down the basic principles for the distribution of the net proceeds of the taxes between the Union and States?
(A) Planning Commission
(B) National Development Council
(C) Finance Commission
(D) Union Ministry of Finance
Question 4: Who was the Chairman of the 13th Finance Commission?
(A) Indira Rajaraman
(B) C. Rangarajan
(C) Vijay Kelkar
(D) None of the above
Question 5: Generally, in India Finance Commission is appointed for every five years _________.
(A) To determine the financial position of the States
(B) To determine the financial position of Central Government
(C) To determine the financial resources of Central Government
(D) To determine the share of the States in the grants and revenues of the Central Government
Question 6: Who among the following was the Chairman of 14th Finance Commission?
(A) Shanta Kumar
(B) C. Rangarajan
(C) Y.V. Reddy
(D) None of the above
Question 7: Finance is distributed between the Centre and the State on the recommendations of which of the following?
(A) Planning Commission
(B) Public Accounts Committee
(C) Finance Commission
(D) National Development Council
Question 8: Who of the following shall cause every recommendation made by the Finance Commission to be laid before each House of the Parliament?
(A) The President of India
(B) The Speaker of Lok Sabha
(C) The Prime Minister of India
(D) The Union Finance Minister
Question 9: The main functions of Finance Commission is __________.
(A) To determine the part of States in central taxes and to determine the principles of financial aid given by the Centre to States
(B) Financial control over States
(C) Financial control over Central
(D) None of the above
Question 10: The Finance Commission is constituted for a period of ___________.
(A) 4 years
(B) 5 years
(C) 7 years
(D) 10 years
Question 11:The Finance Commission is primarily concerned with recommending to the President about _________.
(A) The principle governing grantsin-aid to be given to the States
(B) Distributing the net proceeds of the taxes between the Centre and the States
(C) Neither (A) nor (B)
(D) Both (A) and (B)
Question 12: Which one of the following statements about a State Finance Commission is true?
(A) It is an informal body
(B) It is a Constitutional body
(C) It is an Administrative body
(D) None of the above
Question 13: With reference to the Finance Commission of India, which of the following statements is correct?
(A) It encourages the inflow of foreign capital for infrastructure development
(B) It facilitates the proper distribution of finances among the Public Sector Undertakings
(C) It ensures transparency in financial administration
(D) None of the statements (A), (B) and (C) given above is correct in this context
Question 14: After the commencement of the Constitution how many Finance Commissions have been constituted?
(A) 10
(B) 8
(C) 9
(D) 15
Question 15: Which one of the following is not a function of the Finance Commission in India?
(A) Devolution of Income Tax
(B) Devolution of Excise Duty
(C) Award of grants-in-aid
(D) Devolution of Trade Tax
Question 16: The Finance Commission consists of a Chairman and _________.
(A) Seven other members
(B) Five other members
(C) Four other members
(D) Such other members as may be decided by the President from time-to-time
Question 17: Federal Finance Commission in India relates to __________.
(A) Finances among the States
(B) Finances between States and the Centre
(C) Finances between the Centre and Local Self Governments
(D) None of the above
Question 18: Consider the following statements.
In India taxes on transactions in Stock-Exchanges and Futures Markets are
- Levied by Union
- Collected by the State Government
Code
(A) Only 1
(B) Only 2
(C) Both 1 and 2
(D) Neither 1 nor 2
Question 19: Main agency to resolve the fiscal disputes between the Centre and States is ________.
(A) Supreme Court
(B) Law Minister
(C) Finance Minister
(D) Finance Commission
Question 20: Consider the following statements.
The function(s) of the Finance Commission is/are
- To allow the withdrawal of the money out of the Consolidated Fund of India.
- To allocate among the States the shares of proceeds of taxes.
- To consider applications for grants-in-aid from States.
- To supervise and report on whether the Union and State Governments are levying taxes in accordance with the budgetary provisions.
Which of these statements is/are correct?
(A) Only 1
(B) 2 and 3
(C) 3 and 4
(D) 1, 2 and 4
Question 21: The Provisions regarding the division of taxes between the Union and the States __________.
(A) Can be suspended during Financial Emergency
(B) Can be suspended during National Emergency
(C) Cannot be suspended under any circumstances
(D) Can be suspended only with the consent of a majority of the State Legislatures
Question 22: Consider the following statements and select the correct answer from the code given below.
- Assertion (A): State Finance Commission is a Constitutional body.
- Reason (R): Union Finance Commission cannot recommend financial assistance to Panchayats.
(A) Both (A) and (R) are true and (R) is the correct explanation of (A)
(B) Both (A) and (R) are true,but (R) is not the correct explanation of (A)
(C) (A) is true, but (R) is false
(D) (A) is false, but (R) is true
Question 23: According to the Tenth Finance Commission the share of resources to be transferred to states from the divisible pool will be _________.
(A) 29%
(B) 42%
(C) 47.5%
(D) 25%
Question 24: The Finance Commission is primarily concerned with recommending to the President about Economic and Social Development __________.
(A) the principle government grants-in-aid to be given to the states
(B) distributing the net proceeds of the taxes between the centre and the states
(C) Neither (A) nor (B)
(D) Both (A) and (B)
Question 25: The distribution of finance between centre and states is done on the recommendation of __________.
(A) Finance Ministry
(B) Finance Commission
(C) Reserve Bank of India
(D) NABARD
Question 26: According to the 14th Finance Commission, the percentage share of States in the net proceeds of the shareable Central tax revenue should be __________.
(A) 32%
(B) 35%
(C) 40%
(D) 42%
Question 26: As per 13th Finance Commission Recommendations during 2010-15 transfer to the states in the form of ‘grant-in-aid’ are expected to be ___________.
(A) 44,000 crore
(B) 1,64,892 crore
(C) 3,18,581 crore
(D) 1,07,552 crore
Question 27: With reference to the Finance Commission of India, which of the following statement is correct?
(A) It encourage the inflow of foreign capital for infrastructure development
(B) It facilitates the proper distribution of finances among the public sector undertakings
(C) It ensures transparency in financial administration
(D) None of the statements (A), (B) and (C) given is correct in this context
Question 28: Which of the following is/are among the noticeable features of the recommendations of the Thirteenth Finance Commission?
- A design for the goods and services tax and a compensation package linked to adherence to the proposed design.
- A design for the creation of lakhs of jobs in the next ten years in consonance with India’s demographic dividend.
- Development of a specified share of central taxes to local bodies as grants.
Select the correct answer using the codes given below.
(A) Only 1
(B) 2 and 3
(C) 1 and 3
(D) 1, 2 and 3
Question 29: The Finance Commission is constituted for a period of ___________.
(A) 4 years
(B) 5 years
(C) 7 years
(D) 10 years