Agricultural income tax is assigned to the State Governments by

1. The Constitution of India, under Article 246, distributes legislative powers between the Union and the States through the Seventh Schedule. 2. List II of the Seventh Schedule (State List) enumerates subjects on which State Governments have exclusive power to legislate. 3. Entry 46 in the State List explicitly mentions "Taxes on agricultural income". 4. Therefore, the power to levy taxes on agricultural income is assigned to the State Governments directly by the Constitution of India. 5. The Finance Commission deals with the distribution of net proceeds of taxes between the Union and States, the National Development Council was involved in planning, and the Inter-State Council deals with inter-state coordination; none of these assign the power to tax agricultural income.