taxes types, methods & budgeting process section 1 MCQ Questions & Answers Detailed Explanation

Question : 1

PAN card issued by the Income Tax Department can’t be used for which of the following purpose?

a) proof of registered tax payer

b) proof of address

c) proof of identity

d) proof of date of birth

Question : 2

Consider the following statements:

1. Tax revenue as a per cent of GDP of India has steadily increased in the last decade.
2. Fiscal deficit as a per cent of GDP of India has steadily increased in the last decade.

a) Both 1 and 2

b) 1 only

c) 2 only

d) Neither 1 nor 2

Question : 3

Which of the following best explains the cascading effect of taxation?

1. When tax imposition leads to a disproportionate increase in prices by an extent more than the rise in the tax.
2. When tax imposition leads to a disproportionate decrease in prices by an extent more than the rise in the tax.
3. When tax imposition leads to a disproportionate decrease in imports.
4. When tax imposition leads to a disproportionate decrease in exports.

a) 4 only

b) 1 only

c) 2 and 3 only

d) 3 and 1 only

Question : 4

Which among the following are the sources of revenue for the central Government?

1. Corporate Tax
2. Profit from Public Enterprises
3. Sale of National Savings Certificates
4. Loans received from the World Bank
5. Excise duties

a) 2, 3 and 4

b) 3, 4 and 5

c) 1, 2 and 3

d) All of the above

Question : 5

Who had suggested an imposition of ‘expenditure tax’ in India for the first time?

a) Kaldor

b) R.J. Chelliah

c) Kalecki

d) Gautam Mathur

Question : 6

Which one of the following is not a tax/duty levied by the Government of India?

a) Custom Duty

b) Service Tax

c) Education

d) Toll Tax