Which one of the following taxes is not included in the Central Pool to be shared with the States according to the recommendations of Finance Commission of India? (a) Personal Income Tax (b) Corporate Profit Tax (c) Surcharge and Cess (d) Excise Duties

The 'Divisible Pool' refers to the portion of gross tax revenue collected by the Union Government that is shared with the States based on the Finance Commission's recommendations [2]. According to Article 270 of the Indian Constitution, this pool includes all central taxes and duties except those mentioned in Articles 268, 269, and 271 [3]. Specifically, the pool excludes the cost of collection, tax revenue of Union Territories, and notably, surcharges and cesses levied for specific purposes [1]. While Personal Income Tax, Corporate Profit Tax, and Excise Duties are part of the shared pool, surcharges and cesses are retained exclusively by the Centre [5]. The 80th Amendment (2000) significantly expanded the pool to include most central taxes, but the exclusion of surcharges and cesses remains a constitutional provision under Article 271, making them non-shareable with the states.

Sources

1. [1] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 4: Government Budgeting > The XV Finance Commission has recommended the following transfers for 2021-26: > p. 182
2. [2] https://www.indiabudget.gov.in/budget2015-2016/es2014-15/echapvol1-10.pdf
3. [3] Indian Polity, M. Laxmikanth(7th ed.) > Chapter 15: Centre-State Relations > B. Taxes Levied and Collected by the Centre but Assigned to the States (Article 269): The following taxes fall under this category: > p. 154
4. [4] Laxmikanth, M. Indian Polity. 7th ed., McGraw Hill. > Chapter 15: Centre State Relations > B. Taxes Levied and Collected by the Centre but Assigned to the States (Article 269): The following taxes fall under this category: > p. 154
5. [5] THEMES IN INDIAN HISTORY PART III, History CLASS XII (NCERT 2025 ed.) > Chapter 12: FRAMING THE CONSTITUTION > 4. The P owers of the S tat e > p. 334