| What is/are the most likely advantages of implementing 'Goods and Services Tax (GST)'? |
| 1. It will replace multiple taxes collected by multiple authorities and will thus create a single market in India. |
| 2. It will drastically reduce the 'Current Account Deficit' of India and will enable it to increase its foreign exchange reserves. |
| 3. It will enormously increase the growth and size of economy of India and will enable it to overtake China in the near future. |
| Select the correct answer using the code given below: |
A) Only 1
B) 2 and 3
C) 1 and 3
D) 1, 2 and 3
Correct Answer: A
Solution :
| Exp. [a] 1. Indeed one nation one market is the main theme on which GST is based. |
| 2. GST may improve effeciency, may reduce domestic cost of manufacturing and thereby will help export, but idea of drastic reduction is not correct. |
| 3. China is also competing the proceess of integrating indirect taxes at same time, so the comptitive effect will be nullified. |
| Hence overtaking China will require much more reforms. |
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