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

Responsibility towards the government is

  1. Pay taxes regularly and honestly

  2. None of these

  3. Supply of goods at a reasonable price to consumers

  4. Safety of investment provided by shareholders
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

A business has a legal and social responsibility to comply with government regulations, which includes the regular and honest payment of taxes. Other options relate to consumers or shareholders.

Multiple choice

Businesses and Consumers do this

  1. Complain

  2. Buy Goods and Services

  3. Pay Taxes at the same rate

  4. None

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Both businesses and consumers participate in the economy by purchasing goods and services to satisfy their needs and operations.

Multiple choice

A person's taxes can be reduced by

  1. Exemptions

  2. A tax credit

  3. Donations to charities

  4. All are true
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Exemptions, tax credits, and charitable donations are all common methods used to lower an individual's taxable income or total tax liability.

Multiple choice

Kharaj was a type of tax on

  1. Houses

  2. Cattles

  3. Trade

  4. cultivation

Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Kharaj was the land revenue tax collected from the peasantry during the Delhi Sultanate period, specifically levied on agricultural produce.

Multiple choice commercial studies budgeting meaning, merits and demerits of cash flow statement meaning and objectives of cash flow statement statement of changes in financial position

In calculation of net cash flow, deferred tax payments are classified as _______________.

  1. non-cash revenues

  2. non-cash charges

  3. current liabilities

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

Deferred tax payments are accounting adjustments that do not involve an immediate cash outflow, thus they are treated as non-cash charges when reconciling net income to cash flow from operations.

Multiple choice book keeping and accountancy reserve and fund accounting treatment for depreciation meaning and characteristics of provisions provision for depreciation account

A person is entitled to take credit of input tax as self-assessed in the return and credited to Electronic credit ledger on _____________.

  1. Final basis

  2. Provisional basis

  3. Partly Provisional and partly final basis

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

what is Input Tax Credit under GST, how to calculate ITC, how to claim goods is supplied to a taxable person, the GST charged is known as Input Tax.in the return will be credited to electronic credit ledger on the provisional basis. self-assessed tax by taking credit of input available in electronic credit ledger.

Multiple choice book keeping and accountancy reserve and fund accounting treatment for depreciation meaning and characteristics of provisions provision for depreciation account

Which of the following is not true about claiming refund of service tax under section 142?

  1. Service tax is deposited under earlier law

  2. Provision of service is complete under earlier law

  3. Refund of service tax would be in cash

  4. Refund claim should be within the time limit under section 11B(2) of the Central Excise Act, 1944
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Under section 142 of the CGST Act, the provision of service must be completed under the new law for certain transitional provisions, or the claim relates to tax paid under the earlier law. Option B is incorrect as a condition for claiming a refund under the specific transitional context.

Multiple choice book keeping and accountancy reserve and fund accounting treatment for depreciation meaning and characteristics of provisions provision for depreciation account

Which of the following is not a provision?

  1. Provision for Depreciation

  2. Provision for Discount on debtors

  3. Provision for Tax

  4. Provision for out standing income
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

Provision is a charge against profit, all future expenses and losses which are more probable are provided. As per accrual concept we can make provisions for expenses likely to be incurred but can only record income only after its earned.

Multiple choice book keeping and accountancy partnership accounts (preliminary) adjustment of distributable profits final accounts of partnership firms profit-loss appropriation account

The Advance Ruling Authority shall comprise of

  1. One member from amongst the officers of Central tax.

  2. One member from amongst the officers of State tax or Union Territory tax as the case may be.

  3. (a) & (b)

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

The Advance Ruling Authority under GST law consists of one member from the Central tax officers and one from the State/UT tax officers.