Which of the following is/are among the noticeable features of the recommendations of the Thirteenth Finance Commission? 1. A design for the Goods and Services Tax, and a compensation package linked to adherence to the proposed design 2. A design for the creation of lakhs of jobs in the next ten years in consonance with India's demographic dividend 3. Devolution of a specified share of central taxes to local bodies as grants Select the correct answer using the codes given below:
- A1 only
- B2 and 3 only
- C1 and 3 onlyCorrect
- D1, 2 and 3
Explanation
The correct answer is C because statements 1 and 3 align with the mandate and specific recommendations of the Thirteenth Finance Commission, while statement 2 does not.
Statement 1 is correct because the commission, headed by Vijay Kelkar, recommended a specific model for the Goods and Services Tax and suggested a compensation fund of 50000 crore rupees for states to offset potential revenue losses, provided they followed the recommended design.
Statement 2 is incorrect because Finance Commissions in India are primarily concerned with fiscal federalism and the distribution of financial resources between the Union and the States. Creating specific job targets or employment schemes is the domain of the Planning Commission or specific government ministries, not the Finance Commission.
Statement 3 is correct because the Thirteenth Finance Commission introduced a significant shift by recommending that a percentage of the divisible pool of central taxes be devolved to local bodies in the form of basic and performance grants, rather than just fixed amounts.
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