Taxation System in India NDA Questions

NDA Economics

Taxation System in India MCQ Questions


7.
Indirect taxes such as GST are generally considered to have a regressive impact because:
A.
They are collected only from businesses, not individuals
B.
They apply only to luxury goods
C.
The same tax rate on a good takes up a larger proportion of income for a poorer person than for a wealthier person
D.
They are levied only on the wealthy
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ANSWER :
C. The same tax rate on a good takes up a larger proportion of income for a poorer person than for a wealthier person
8.
The economic concept referring to the person who ultimately bears the real economic burden of a tax (as opposed to the person who initially remits it to the government) is known as the:
A.
Tax slab
B.
Tax rate
C.
Tax base
D.
Incidence of tax
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ANSWER :
D. Incidence of tax
9.
The legal, planned use of provisions within the tax law to minimise one's tax liability (a legitimate practice) is referred to as tax:
A.
Evasion
B.
Avoidance
C.
Fraud
D.
Default
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ANSWER :
B. Avoidance
10.
The illegal act of not paying taxes that are legally due, such as by concealing income or falsifying records, is referred to as tax:
A.
Deduction
B.
Planning
C.
Evasion
D.
Avoidance
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ANSWER :
C. Evasion
11.
Which of the following best describes 'tax buoyancy'?
A.
The interest rate charged on delayed tax payments
B.
The responsiveness of tax revenue to changes in national income, including the effect of discretionary changes in tax policy
C.
A fixed percentage of GDP collected as tax every year without exception
D.
The total amount of direct tax collected in a year
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ANSWER :
B. The responsiveness of tax revenue to changes in national income, including the effect of discretionary changes in tax policy
12.
Article 265 of the Constitution of India lays down the fundamental principle that:
A.
No tax shall be levied or collected except by authority of law
B.
States cannot levy any taxes
C.
Any tax may be levied by the executive without legislative sanction
D.
All taxes must be approved directly by the President without Parliament
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ANSWER :
A. No tax shall be levied or collected except by authority of law