In India stamp duties on financial transactions are 1 levied and collected by the sta...........

Economic Affairs Tax System

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In India stamp duties on financial transactions are

1. levied and collected by the state governments

2. appropriated by Union governments

Which of the statements given above is/are correct?

Only 1

Only 2

Both

Neither

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Explanation:

Both statements are incorrect.

Stamp duty is a form of tax that is levied on documents. It is levied by the union or the central government and collected and appropriated by the state governments. (Entry 91 in the union list; entry 63 in the state list of Seventh Schedule of Constitution of India).

Historically, this included the majority of legal documents such as cheques, military commissions, marriage licences and land transactions. The administration of such rights is required to be enforced by the State from time to time. Stamp laws are administered under the Indian Stamp Act and various State Stamp Acts and Rules.

Hence option 4th is correct.