Tag: taxation : need, principles and importance

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Questions Related to taxation : need, principles and importance

Multiple choice economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

If a government is unable to pass the budget in Lok Sabha, then ______.

  1. a totally new budget is presented

  2. the budget is revised and presented again

  3. the government has to resign

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

If a government is unable to pass the budget in Lok Sabha, then the government has to resign.

Multiple choice economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

The Economic Survey is compiled by ______.

  1. office of economic advisor

  2. central statistical office (CSO)

  3. national sample survey organization (NSSO)

  4. department of economic affairs
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

The Economic Survey is compiled by Department of Economic Affairs, Ministry of Finance. Office of economic advisor publishes WPI, while CSO publishes IIP and CPI.

Multiple choice economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

Income Tax is rounded off to ________________.

  1. Nearest one rupee

  2. Nearest ten rupees

  3. Nearest hundred rupees

  4. Nearest thousand rupees
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

An income tax is a tax that governments enforce on income generated by businesses and individuals within their authority. By law, taxpayers must file an income tax return yearly to determine their tax obligations Income taxes are a source of revenue for governments. 

As per Section 288 B of the income tax act, the total tax computed shall be curved off to the nearest Rs 10. The income tax is rounding off would be done on the total tax payable or refundable and not to various dissimilar sub-heads of taxes like income tax, education cess, a surcharge etc.

Thus, the correct option is B.

Multiple choice social science tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

A tax that takes away a higher proportion of one's income as the income rises is termed as ___________.

  1. proportional tax

  2. progressive tax

  3. regressive tax

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

A progressive tax is defined by a system where the tax rate increases as the taxable amount increases, meaning those with higher incomes pay a higher proportion of their income in taxes.

Multiple choice economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

Marginal Rate of Tax refers to ____________.

  1. lowest rate of Income Tax

  2. highest rate of Income Tax

  3. average rate of Income Tax

  4. nil rate of Income Tax
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

The marginal tax rate is the rate of tax applied to the last unit of currency earned, which corresponds to the highest tax bracket applicable to that individual's income.

Multiple choice social science tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

To remove inequalities, the Government uses ___________.

  1. indirect taxes

  2. regressive taxes

  3. progressive taxes

  4. proportional taxes
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

Progressive taxes are used as a fiscal tool to redistribute income from the wealthy to the less affluent, thereby reducing economic inequality in society.

Multiple choice economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

The reasons for high tax incidence in India are____________.

  1. increase in expenditure on development planning

  2. rise in expenditure on defence and other non-developmental activities

  3. high cost of collection

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

High tax incidence in India is driven by the need to fund development projects, rising defense expenditures, and the administrative costs associated with collecting taxes from a large and diverse population.

Multiple choice economics tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

Tax reform committee (TRC) was constituted for comprehensive reform of _________.

  1. direct tax laws

  2. indirect tax laws

  3. both direct and indirect tax laws

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

The Tax Reform Committee, often associated with the Chelliah Committee, was established to provide a comprehensive framework for reforming both direct and indirect tax structures in India.

Multiple choice social science tax and its importance taxation : need, principles and importance main feature of tax public revenue and taxation

Which of the following is a progressive tax?

  1. Income tax

  2. Sales tax

  3. Custom duty

  4. Excise duty
Reveal answer Fill a bubble to check yourself
A Correct answer
Explanation

Income tax is a classic example of a progressive tax because the tax rate increases as the taxpayer's income increases. Sales tax, custom duty, and excise duty are generally regressive or proportional.