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Q61
(CDS-I/2024)
Economy › Government Finance & Budget › Taxation powers distribution
Answer Verified
Which of the following components of Central Government taxes on petroleum products is/are not shareable with the States?
- Special Additional Excise Duty
- Road and Infrastructure Cess
- Agriculture Infrastructure and Development Cess
Select the correct answer using the code given below:
Result
Your answer:
—
·
Correct:
D
Explanation
Under Article 270 of the Constitution, taxes are shared between the Centre and States based on Finance Commission recommendations. However, surcharges and cesses are excluded from this 'divisible pool' and are retained entirely by the Central Government.
The components mentioned in the CDS-I 2024 exam are:
- 1. Special Additional Excise Duty (SAED): A surcharge on petroleum products.
- 2. Road and Infrastructure Cess (RIC): A specific-purpose cess.
- 3. Agriculture Infrastructure and Development Cess (AIDC): A specific-purpose cess introduced in the 2021-22 Budget.
Because all three are classified as either a surcharge or a cess, none of them are shareable with the States. Consequently, the correct code is 1, 2, and 3.
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