| In the Government of India's budget for the year 2013 - 14, the Finance Minister proposed to raise the Goods and Services Tax (GST) on cigarettes. He also proposed to increase income tax on individual earning more than rupee one crore per annum. |
| What would be the effect of increase in direct tax on the rich? |
A) It will reduce the gap between rich and the poor, thereby reducing inequalities in income
B) It will increase the gap between rich and the poor
C) Both [a] and [b]
D) None of the above
Correct Answer: A
Solution :
[a] It will reduce the gap between rich and the poor, thereby reducing inequalities in income
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