Consider the following: 

1. Demographic performance 

2. Forest and ecology 

3. Governance reforms 

4. Stable government 

5. Tax and fiscal efforts 

For the horizontal tax devolution, the Fifteenth Finance Commission used how many of the above as criteria other than population area and income distance? 

(a) Only two 

(b) Only three 

(c) Only four 

(d) All five 

Ans: b

Explanation:

Horizontal devolution:

Based on principles of need, equity and performance, overall devolution  formula is  based on following 6 criteria

Income distance is the distance of the Gross State Domestic Product (GSDP) of a particular state from the state with the highest GSDP.

To maintain inter state equity, the states with lower per capita income would be given a higher share.

Hence, option b is correct.

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