Which among the following is / are correct statements with respect to the Fourteenth Finance Commission recommendations:
1. It recommended to enhanced the share of the states in the central divisible pool of taxes from 32 percent to 42 per cent
2. It has used forest cover and fiscal discipline in the formula for distribution of funds among states
Select the correct option from the codes given below:

Answer: [A] Only 1

The FFC has radically enhanced the share of the states in the central divisible pool of taxes from the current 32 percent to 42 per cent which is the biggest ever increase in vertical tax devolution.

The second statement is partially correct. Relative to the Thirteenth Finance Commission, the FFC has incorporated two new variables: 2011 population and forest cover; and excluded the variable relating to fiscal discipline. Kindly note this.

This question is a part of GKToday's Integrated IAS General Studies Module