1. Which of the following statements are true?
1. Negative Income Tax is a taxation scheme that provides income subsidies to people and families who fall below the poverty threshold
2. Laffer Curve is based on the principle that increasing tax rates boost economic growth
A. 1 only
B. 2 only
C. Both 1&2
D. Neither 1nor2
2. Consider the following statements:
1. Taxation refers to levy on individuals or companies by the governments
2. Government’s right to levy taxes is derived from the Indian Constitution
3. Every tax imposed within the country must be accompanied by an accompaniment law passed by the State Legislature or the Parliament
A. Only one statement is true
B. All statements are true
C. No statement is true
D. Only two statements are true
3. Which of the following statements are true?
1. A direct tax is one that is levied directly on the taxpayer and paid directly to the government
2. Central Board of Direct Taxes is responsible for levying and collecting direct taxes
A. 1 only
B. 2 only
C. Both 1&2
D. Neither 1nor2
4. Which of the following is an example of a progressive tax?
A. Flat Sales Tax
B. Value Added Tax (VAT)
C. Custom Duty
D. Luxury Sales Tax
5. Which of the following are Similarities Between Cess and Surcharge :
1. levied by the state government
2. collected and deposited in India’s Consolidated Fund
3. cannot be shared by state governments.
A. Only one statement is true
B. All statements are true
C. No statement is true
D. Only two statements are true
6. How does GST mitigate cascading effects?
A. By increasing double taxation
B. By reducing double taxation
C. By imposing additional taxes
D. By eliminating input taxes
7. What is the primary difference between tax evasion and tax avoidance?
A. Tax evasion is legal, while tax avoidance is illegal.
B. Tax evasion involves loopholes, while tax avoidance involves non-payment.
C. Tax evasion is illegal, while tax avoidance involves loopholes.
D. Tax evasion is intentional, while tax avoidance is unintentional.
8. Which of the following statements are true?
1. Value Added Tax was in effect until July 1, 2017 in India
2. Value Added Tax has now been replaced by SGST
A. 1 only
B. 2 only
C. Both 1&2
D. Neither 1nor2
9. When was Gift Tax first introduced in India?
A. 1950
B. 1958
C. 1968
D. 1978
10. Which of the following statements are true?
1. Commodities Transaction Tax was introduced in the 2013-14
2. Fundamental goal of the Commodities Transaction Tax was to distinguish between derivative trading
A. 1 only
B. 2 only
C. Both 1&2
D. Neither 1nor2
