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Q75 (IAS/1994) Polity & Governance › Constitutional Basics & Evolution › Constitutional structure Answer Verified

Which of the following taxes is/are levied by the Union and collected and appropriated by the States ?

Result
Your answer: —  ·  Correct: A
Explanation

Article 268 of the Constitution specifically provides for “duties levied by the Union but collected and appropriated by the States,” and this category explicitly includes stamp duties (on bills of exchange, cheques, promissory notes, policies of insurance, transfer of shares, etc.) — these are levied by the Centre but assigned to States [1]. Estate duty (insofar as it concerns agricultural land) falls under the State List (Entry 48, List II) and is a state power, not a Union duty under Article 268 [2]. Taxes on newspapers (sale/purchase) and passenger/goods taxes are not the Article 268 duties; sale/purchase taxes on newspapers have been treated differently and are associated with assignment provisions to States . Therefore only option 1 is correct.

Sources

  1. [1] Laxmikanth, M. Indian Polity. 7th ed., McGraw Hill. > Chapter 15: Centre State Relations > II Distribution of Tax Revenues > p. 153
  2. [2] Introduction to the Constitution of India, D. D. Basu (26th ed.). > Chapter 25: DISTRIBUTION OF FINANCIAL POWERS > DISTRIBUTION OF FINANCIAL POWERS > p. 384
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