Taxes Types, Methods & Budgeting Process Section 1 Practice Questions Answers Test With Solutions & More Shortcuts

Question : 1 [UP-PCS 2013]

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

Answer: (d)

Toll Taxes is one the main Sources of revenue for State Governments. It is not levied by Govt. of India.

Question : 2 [UPPCS (Pre) 2010]

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

Answer: (a)

Question : 3 [UPPCS (Pre) 1998]

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
Select the correct answer from the codes given below.

a) 2, 3 and 4

b) 3, 4 and 5

c) 1, 2 and 3

d) All of the above

Answer: (d)

Question : 4

Which of the following are part of capital budget of Govt. of India?

  1. Issuance of Sovereign Gold Bonds
  2. Receipt from Gold Monetization
Select the correct answer using the code given below:

a) (ii) only

b) Both (i) & (ii)

c) (i) only

d) Neither (i) nor (ii)

Answer: (b)

In the case of Sovereign Gold Bonds, the government issues/creates the gold bond and in return, it gets money from the public.

This money will come under capital receipt because the gold bond is a kind of liability for the govt. which the govt. must pay in future. Principal payment will come under capital expenditure and interest payment will come under revenue expenditure.

The physical gold which the govt. receives from the pubic in case of gold monetization scheme becomes a liability for the govt. (in return for the physical gold, govt issues a paper which is basically liability for the govt.) which the govt. will have to pay in future either in physical gold form or in cash.

Question : 5

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

Answer: (b)

Permanent Account Number (PAN)card is a unique alphanumeric combination. It is issued by the Indian Income Tax Department. It serves as an important ID proof, date of birth proof and proof of taxpayer.

However, it can’t be used for the purpose of address proof, as the address is not mentioned on the PAN card.

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