1. State Government Tax
Which of the following tax is imposed by the state government?
a. Entertainment Tax
b. Property Tax
c. Income Tax
d. Corporate Tax
Ans: a
2. Economic Inequalities Reduction
Which of the following tax systems helps to reduce economic inequalities in India?
a. Regressive Tax
b. Progressive Tax
c. Flat Rate Tax
d. None of these
Ans: b
3. Direct Tax
Which among the following is a direct tax?
a. Sales Tax
b. Excise Tax
c. Wealth Tax
d. Entertainment Tax
Ans: c
4. Regressive Tax Definition
Taxes are called regressive when:
a. More burden on poor compared to rich
b. Same burden on rich and poor
c. Less burden on poor as compared to rich
d. None of these
Ans: a
5. Finance Commission Chairman
Who was the Chairman of the 13th Finance Commission?
a. Dr. Vijay L Kelkar
b. Dr. C. Rangarajan
c. Dr. A.M. Khusro
d. Dr. C. Subbarao
Ans: a
6. VAT Implementation
VAT was first implemented in:
a. Germany
b. Spain
c. France
d. Russia
Ans: c
7. Gadgil Formula Usage
In Centre-State financial relations in India, the Gadgil formula is used in:
a. Division of tax revenue
b. Formulation of policy for fresh borrowings
c. Writing off state’s indebtedness to the Centre
d. Allocating Central Plan Assistance between states
Ans: d
8. Nature of Indirect Taxes
Indirect taxes by nature are:
a. Digressive
b. Regressive
c. Progressive
d. Proportional
Ans: b
9. Vijay Kelkar Committee Report
The report of the Vijay Kelkar Committee relates to:
a. Trade Reforms
b. Centre-State Financial Relations
c. Disinvestment in Public Sector Enterprises
d. Tax Reforms
Ans: d
10. Excise Duty Payment
Excise duty on a commodity is payable with reference to its:
a. Production
b. Production and Sale
c. Production and Transportation
d. Production, Transportation, and Sale
Ans: a
11. Central Tax
Which of the following sets belong to Central tax?
a. Excise Duty, Sales Tax, and Customs Duty
b. Excise Duty, Customs Duty, and Income Duty
c. Income Tax, Customs Duty, and House Tax
d. Customs Duty, Entertainment Tax, and Income Tax
Ans: b
12. Inflation and Taxation
Which of the following taxes does not cause a rise in prices?
a. Import Duty
b. Income Tax
c. Octoroi
d. Sales Tax
Ans: b
13. Corporate Tax
Corporation tax is imposed on:
a. The net income of companies
b. The corporate properties
c. The utilities provided by the corporation
d. Tax imposed by the corporation on individual properties
Ans: a
14. Parallel Economy
Parallel economy emerges due to:
a. Tax avoidance
b. Tax evasion
c. Tax compliance
d. Tax estimation
Ans: b
15. Grants-in-Aid Principles
Which authority recommends the principles governing grants-in-aid to states from the Consolidated Fund of India?
a. Public Accounts Committee
b. Union Ministry of Finance
c. Finance Commission
d. Inter-State Council
Ans: c
16. Indirect Tax Example
Which of the following is NOT an example of an indirect tax?
a. Sales Tax
b. Excise Tax
c. Custom Tax
d. Expenditure Tax
Ans: d
17. Largest Tax Paying Sector
Which is the largest tax-paying sector in India?
a. Agriculture sector
b. Industrial sector
c. Transport sector
d. Banking sector
Ans: b
18. Tax Assigned to States
Which of the following taxes collected by the Union is NOT mandated to be assigned to the states?
a. Terminal taxes on goods or passengers
b. Taxes on railway fares and freights
c. Taxes on consignment of goods
d. Service tax
Ans: d
19. Canon of Taxation
The ‘Canon to Taxation’ was propounded by:
a. Edwin Canon
b. Adam Smith
c. J.M. Keynes
d. Dalton
Ans: b
20. Custom Duty Instrument
Custom duty is an instrument of:
a. Monetary Policy
b. Foreign Policy
c. Industrial Policy
d. Fiscal Policy
Ans: b
21. External Debt
A part of National Debt known as External Debt is the amount:
a. Borrowed by its citizens from abroad
b. Lent by its citizen to a foreign government
c. Borrowed by its government from abroad
d. Lent by its government to a foreign government
Ans: c
22. Non-Customs Duty Trade Barrier
Which among the following is NOT a non-customs duty obstacle to world trade?
a. Quantity restriction
b. Establishment of Standard
c. Uniform determination of import duty
d. Restrictions on goods quality
Ans: b
23. Taxes Transferred to States
Which of the following taxes are levied and collected by the Centre but their net proceeds are wholly transferred to states?
a. Expenditure Tax and Gift Tax
b. Additional Duties of Excise in lieu of Sales Tax
c. Stamps and Registration
d. Taxes on Advertisement
Ans: d