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Under Article 268, duties like stamp duties on bills of exchange, etc., are levied by the Union but collected and appropriated by the ______, reflecting shared fiscal federalism in indirect taxation.
- Union
- States
- local bodies
- Reserve Bank
Answer: States
Article 268 Union duties levied by States: (a) Constitutional provision: Certain duties (stamp duties on bills of exchange, etc.) levied by Union but collected and appropriated by States where levied, (b) Rationale: (i) Administrative efficiency: States better positioned to collect certain duties locally, (ii) Fiscal federalism: Shares revenue from Union-levied duties with States, (iii) Coordination: Union sets rates, States collect, ensuring uniformity with local administration, (c) Applications: (i) Stamp duties: On bills of exchange, cheques, etc., collected by States for local infrastructure, services, (ii) Revenue sharing: States retain collections, enhancing fiscal autonomy for local development, (iii) GST impact: Many Article 268 duties subsumed under GST, but principle of shared collection remains relevant, (d) Distinction from other articles: Article 269 (Union taxes assigned to States), Article 270 (taxes levied/collected by Union and distributed), Article 271 (Union surcharge on taxes), (e) Illustrates calibrated fiscal federalism: Union-State revenue sharing through shared collection mechanisms; balance between Union's role in rate-setting and States' role in collection, appropriation for local needs.