Consider the following statements: In India, stamp duties on financial transactions are:1. Levied and collected by the State Government2. Appropriated by the Union Government Which of these statements is/are correct?
✓ Correct answer: a) Only 1
ExplanationStamp duty is a tax levied by the state government on the transfer of property/property ownership.It is governed by Section 3 of the Indian Stamp Act, 1899. The amount of stamp duty at the time of registration depends on the value of the prop- erty.It also varies based on the location of the property, as well as whether the property is newly constructed or pre-owned.Statement 1 is correct : Stamp duties on financial transactions are levied and collected by State Governments under the Sev- enth Schedule of the Indian Constitution (State List).Statement 2 is incorrect : The revenue from stamp duties is not appropriated by the Union Government but remains a vital source of income for state governments.Stamp duties play a sig- nificant role in generating non-tax revenue for states.They are imposed on documents such as property deeds, share certifi- cates, and other financial instruments.222
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