Which of the following is a feature of the Indian fiscal federalism?
A. Only states collect all major taxes
B. Absence of any sharing of taxes
C. Division of tax powers between Centre and States with Finance Commission recommendations
D. Complete centralisation of all taxes
Answer: Option C
Solution (By JKSSB Mock Tests)
Indian fiscal federalism involves constitutional division of tax bases between the Centre and States, with the Finance Commission recommending the sharing of divisible taxes and grants.
Explanation:
In 2015, the Planning Commission was replaced by NITI Aayog, which promotes cooperative federalism, provides strategic and technical advice, and does not impose centralised Five Year Plans in the earlier form.
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