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Finance Commission: 16 previous year questions

UPSC has asked 16 questions on Finance Commission between 1980 and 2024: CSE 6 · CAPF 5 · CISF (LDCE) 2 · NDA 1 · EPFO (AO/EO) 1 · CDS 1. 8 of them came after 2015, so this is a live topic examiners keep returning to. 6 were set in Civil Services Prelims; the rest come from UPSC's other papers, which draw on the same question bank.

Practise these 16, one at a timeRead the questions

Tap an option to check yourself. Answers follow the official UPSC key; where the key was dropped or disputed the question is not shown.

CAPF2024Finance CommissionOn card POL 10·3

Consider the following statements : 1. The 15th Finance Commission used fiscal effort as a criterion for horizontal devolution unlike the 14th Finance Commission 2. Both the 14th and the 15th Finance Commission used pre- 2011 demographic variables as a criteria for horizontal devolution Which of the statements given above is/are correct ?

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Answer C (official UPSC key)15th FC used fiscal effort for horizontal devolution, unlike the 14th | both 14th and 15th used pre-2011 demographic variables
NDA2024 · 1Finance CommissionOn card POL 10·3

Which of the following statements with regard to the constitution of Finance Commission is/are correct ? 1. The Government of India has recently constituted the Sixteenth Finance Commission under the Chairmanship of Dr. Arvind Panagariya. 2. Finance Commission is constituted in pursuance to Article 263 of the Constitution of India. Select the answer using the code given below :

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Answer A (official UPSC key)Sixteenth Finance Commission → chaired by Dr Arvind Panagariya | NOT: constituted under Article 263
CISF (LDCE)2021Finance CommissionOn card POL 10·3

Which one of the following statements about the Finance Commission is not correct ?

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Answer B (official UPSC key)Finance Commission → NOT correct: the 14th FC was set up in 2017 for GST
CAPF2019Finance CommissionOn card POL 10·3

Which of the following are the essential requirements for a person to be appointed as a member of Finance Commission ? 1. Supreme Court judge or one qualified to be appointed as such 2. A person having wide experience in financial matters and administration 3. A person having special knowledge of economics Select the correct answer using the code given below :

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Answer C (official UPSC key)Finance Commission member requirements → wide experience in financial matters and administration | special knowledge of economics | NOT: SC judge or qualified as one
CDS2015 · 2Finance CommissionOn card POL 10·3

Which one of the following is not a recommendation of the Fourteenth Finance Commission?

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Answer D (official UPSC key)NOT a 14th Finance Commission recommendation → sector-specific grants as before
CAPF2010Finance CommissionOn card POL 10·3

Consider the following statements Statement I: The Finance Commission makes principles which govern the grants-in- aid of revenues given to the States out of the Consolidated Fund of India. Statement II: Members of the Finance Commission are drawn from all the States and Union Territories. Code

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Answer C (official UPSC key)Finance Commission recommends principles for grants-in-aid to States from the CFI (I true) | NOT: its members are drawn from all States and UTs
CSE2003Finance CommissionOn card POL 10·3

Consider the following statements: [2003] The function(s) of the Finance commission is/are: 1. to allow the withdrawal of the money out of the Consolidated Fund of India 2. to allocate between the States the shares of proceeds of taxes 3. to consider applications for grants-in-aid from States 4. 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?

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Answer B (official UPSC key)Finance Commission → allocates tax shares between States | considers grants-in-aid applications | NOT: allows withdrawals from the CFI | NOT: supervises tax levying
CSE1982Finance CommissionOn card POL 10·3

Finance Commission is appointed for

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Answer D (official UPSC key)Finance Commission → recommends to the President the Union–State distribution of net tax proceeds

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