SSC Economics Sample Paper NCERT Sample Paper-3

  • question_answer
    Which of the following statements is/are true for the Income Tax in India?
    I. It is a progressive tax
    II. It is a direct tax
    III. It is collected by the State Governments
    IV. It is a proportional tax

    A)  Only I is correct

    B)         I and II are correct

    C)  I, II and III are correct   

    D)  II, III and IV are correct

    Correct Answer: B

    Solution :

    [b] Income taxes are widely viewed as a Progressive tax, meaning the incidence of tax increases as income increases. A progressive tax system (in which the rich pay more than the poor) is one in which direct taxes account for more revenue than indirect taxes (which are on goods and services). In that respect, India's period of supposedly extortionate tax rates produced a most undesirable result because the Centre's next direct tax revenue was barely a fifth of its net indirect tax revenue.

You need to login to perform this action.
You will be redirected in 3 sec spinner