Economics · General Awareness

Indian Taxation System

2,325 Questions

The Indian taxation system comprises direct and indirect levies including income tax, goods and services tax, and property tax. Understanding these tax structures is crucial for general awareness sections in banking and government exams. The practice set covers central and state tax collections, exemptions, and capital gains rules.

Goods and Services TaxIncome tax rulesProperty tax assessmentsTax exemptionsCentral versus state taxes

Indian Taxation System Questions

Multiple choice business organisation and correspondence joint stock company 3 - promotion and formation of a company formation and promotion of a company promoter promotion and formation of a company

Which of the following taxes has reduced the net earnings of companies?

  1. Sales tax

  2. Capital gains tax

  3. Wealth tax

  4. Corporate income tax
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

An assessment levied by a government on the profits of a company. The rate of corporate income tax paid by a business varies between countries, although since corporations are legal entities distinct from their owners and operators, they are typically taxed as if they were people.

Therefore corporate income tax has reduced the net earnings of companies.

Multiple choice commercial studies company final accounts forms of statements of profit and loss operating profit (ebit) meaning, need and format of profit and loss account

In a sole traders profit and loss account firm taxation accounts are not present because ______________.

  1. the proprietor of such a business pays income tax in his private capacity

  2. the Income tax department has not made laws regarding the taxation of firms

  3. as sole trader has a simple business so tax paying is not required

  4. the business is separate undertaking for the purposes of tax
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

In a sole proprietorship, the business is not a separate legal entity for tax purposes. The proprietor is personally liable for income tax on the business profits.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

Income from sale of second hand property should be included in national income.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The sale of second-hand goods is not included in national income because the value was already counted when the item was originally produced. Including it again would lead to double counting.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

Mixed income of the self employed means __________.

  1. gross profits received by proprietors

  2. rent, interest and profit of an enterprise

  3. combined factor payments, which are not distinguishable

  4. wages due to family workers
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Mixed income of the self employed means combined factor payments of rent, wages, interest and profits received by the self-employed professional, which are not distinguishable.

Multiple choice business economics and quantitative methods measurement of national income methods of national income methods of measuring national income national income analysis

Income Method does not include _____________.

  1. rent

  2. mixed incomes

  3. pensions

  4. all of the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Pensions are considered transfer payments rather than factor income, as they are not earned through current productive services. Therefore, they are excluded from the Income Method.

Multiple choice geography kerala, from eighth to eighteenth century kerala during medieval period in the land of kerala study of kerala

___________ was a kind of tax rebate. According to this, all the plants which had not yet started yielding were exempted, when the pattam was calculated by Janmis.

  1. Kettezhuthu

  2. Kuzhikanam

  3. Kandezhuthu

  4. Verumpattam
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Kuzhikanam was a kind of tax rebate that existed during the 12th and 18th centuries CE. According to this, all the plants which had not yet started yielding were exempted, when the pattam was calculated by the Janmis who had ownership of the Janmam Lands.

Multiple choice business organisation and correspondence companies act, 2013 - introduction and characteristics introduction to companies companies act, 2013 company

Which of the following is a correct statement?

  1. Goods and Service Tax (GST) is a consolidation of many indirect taxes already levied in India

  2. In India, Excise duty and Service tax are levied by the Central Government

  3. VAT is levied by the State Governments

  4. All of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

GST consolidated various indirect taxes, the Central Government levies excise and service tax (pre-GST context), and VAT was historically a state-level tax. All these statements are accurate descriptions of the Indian tax landscape.

Multiple choice history the development of regional culture development of regional culture during medieval period india in 18th century rise of independent states kings and kingdoms of the early medieval period

What does Mohatarfa mean during Maratha rule?

  1. Tax on trades and profession

  2. Tax on sales and purchase

  3. Tax on production

  4. Tax on entertainment
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Mohatarfa was the duties imposed on traders and professionals, and it was treated as the income tax.  The tax varied from place to place, shop to shop and profession to profession. It depended on the earning of each trader. 

Multiple choice book keeping and accountancy bases of accounting cash and mercantile system basis of accounting basis of accounting system

Which of the following is an intrastate supply?

  1. Supplier of goods located in Delhi and place of supply of goods SEZ located in Delhi

  2. Supplier of goods located in Delhi and place of supply of goods in Jaipur

  3. Supplier of goods located in Delhi and place of supply of goods in Delhi

  4. All the above
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

An intrastate supply occurs when the location of the supplier and the place of supply are in the same state.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

Besides the level of income, the taxation policies of the government also affect the ability to save.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Even when the income of person is high , he is left with less real income after paying the high taxes levied by the government this then affects both the level of consumption and savings of the person.

Multiple choice economics concept of consumption function, saving function and investment function capital economy of a village wealth, capital and money

When the rates of income tax and sales tax are high, the major portion of the earnings of people goes to the government exchequer and very little remains with people to save and invest.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

When high rate of taxes (income tax and sales tax)  are imposed by the government ,the real income of the consumers go down and hence the purchasing power falls so in turn savings of the people falls accordingly.

Multiple choice commercial studies concept of market and marketer meaning and importance of marketing meaning and definition of market introduction to marketing marketing environment meaning and definition of marketer role of marketing

Which of the following persons can opt for composition scheme?

  1. Person making any supply of goods which are not leviable to tax under this Act

  2. Person making any inter-State outward supplies of goods

  3. Person effecting supply of goods through an e-commerce operator liable to collect tax at source

  4. None of the above
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The composition scheme under GST (in India) has specific restrictions, such as prohibiting inter-state supplies and supplies through e-commerce operators liable for TCS. Therefore, none of the listed persons are eligible.