MCQs
Total Questions : 163
| Page 14 of 17 pages
Answer: Option B. -> 3 alone
Answer: (b)
Answer: (b)
Answer: Option D. -> It is the aggregate value of financial streams on which tax can be imposed by the government
Answer: (d)
The tax base is defined as the total value of the financial streams or assets on which tax can be imposed by the government.
For example, in the case of income tax, the tax base is the minimum amount of annual income that can be taxed by the government (taxable income). If this minimum amount (tax threshold) is lowered, this will automatically increase (widen) the tax base; if it is raised, the tax base will be narrowed.
In the case of GST, the tax base is the value of goods and services on which GST is imposed.
In the case of property tax, the tax base is the value of the property on which property tax is imposed. Because the size of the tax base influences the taxable revenues that are available to a government, the size and growth of the tax base is crucial to the planning efforts of any government.
Answer: (d)
The tax base is defined as the total value of the financial streams or assets on which tax can be imposed by the government.
For example, in the case of income tax, the tax base is the minimum amount of annual income that can be taxed by the government (taxable income). If this minimum amount (tax threshold) is lowered, this will automatically increase (widen) the tax base; if it is raised, the tax base will be narrowed.
In the case of GST, the tax base is the value of goods and services on which GST is imposed.
In the case of property tax, the tax base is the value of the property on which property tax is imposed. Because the size of the tax base influences the taxable revenues that are available to a government, the size and growth of the tax base is crucial to the planning efforts of any government.
Question 133. Which of the following is/are included in the capital budget of the Government of India?
Select the correct answer using the code given below.
- Expenditure on acquisition of assets like roads, buildings, machinery, etc.
- Loans received from foreign governments
- Loans and advances granted to the States and Union Territories
Select the correct answer using the code given below.
Answer: Option D. -> All of the above
Answer: (d)
Those receipts/expenditures of the government which changes the liability or the assets (physical or financial) of the Govt. comes under capital budget.
Expenditure on the acquisition of assets like roads or buildings come under capital expenditure.
Loans received increases the liability and loans given by govt. increases the assets of govt., hence the capital budget.
Answer: (d)
Those receipts/expenditures of the government which changes the liability or the assets (physical or financial) of the Govt. comes under capital budget.
Expenditure on the acquisition of assets like roads or buildings come under capital expenditure.
Loans received increases the liability and loans given by govt. increases the assets of govt., hence the capital budget.
Answer: Option C. -> (i) & (ii) only
Answer: (c)
Exports, imports and movement of goods from one state to another state is treated as an interstate supply for the purpose of GST.
On imports, first customs duty is imposed and then Integrated GST (IGST) is also imposed.
Answer: (c)
Exports, imports and movement of goods from one state to another state is treated as an interstate supply for the purpose of GST.
On imports, first customs duty is imposed and then Integrated GST (IGST) is also imposed.
Answer: Option B. -> Both (i) & (ii)
Answer: (b)
Goods and Services Tax Network (GSTN) is a Section 8 (under new companies Act, not for profit companies are governed under section 8), non-Government company.
(But cabinet has approved a decision to make it a wholly-owned govt. company).
It was incorporated on March 28, 2013. The Company has been set up primarily to provide IT infrastructure and services to the Central and State Governments, taxpayers and other stakeholders for implementation of the Goods and Services Tax (GST).
Answer: (b)
Goods and Services Tax Network (GSTN) is a Section 8 (under new companies Act, not for profit companies are governed under section 8), non-Government company.
(But cabinet has approved a decision to make it a wholly-owned govt. company).
It was incorporated on March 28, 2013. The Company has been set up primarily to provide IT infrastructure and services to the Central and State Governments, taxpayers and other stakeholders for implementation of the Goods and Services Tax (GST).
Answer: Option B. -> (i), (ii) & (iv) only
Answer: (b)
Royalty from onshore (on land) oilfields goes to the State Governments as State governments are the owners of the minerals beneath the land in their territory.
From offshore (within sea) oilfields, royalty goes to Central Government as Central Govt. is the owner of the offshore fields. So, (iii) statement is not true.
Answer: (b)
Royalty from onshore (on land) oilfields goes to the State Governments as State governments are the owners of the minerals beneath the land in their territory.
From offshore (within sea) oilfields, royalty goes to Central Government as Central Govt. is the owner of the offshore fields. So, (iii) statement is not true.
Question 137. Consider the following statements regarding the Fifteenth Finance Commission (FFC) recommendations:
Select the correct answer using the code given below:
- It has recommended 41% devolution from Central taxes to States in 2020-21
- It has recommended 1% devolution from Central taxes to the Union Territories of J&K and Ladakh 2020-21
Select the correct answer using the code given below:
Answer: Option C. -> (i) only
Answer: (c)
The Finance Commission recommends for devolution of taxes (from the divisible pool) from Centre to States only (called Vertical devolution) and is not meant for UTs, whether they have their own assembly/legislature or not.
The Fifteenth Finance Commission (FFC) recommendations will be applicable for six years period from 2020-21 to 2025-26. For the year 2020-21, the recommendations have been submitted and the final recommendations for the five-year period 2021-22 to 2025- 26 will be submitted by October 2020.
FFC quoted:
“The State of Jammu & Kashmir was reorganised into the Union Territories (UT) of Ladakh and Jammu & Kashmir through the Jammu & Kashmir Reorganisation Act, 2019. Article 280 of the Constitution, along with the Jammu and Kashmir Reorganisation Act puts the newly-created UTs of Ladakh and Jammu and Kashmir outside the purview of the Finance Commission's award.
Since UTs are the responsibilities of the Union, they are within the purview of the Union budget. We have notionally estimated that the share of the erstwhile State of Jammu & Kashmir would have come to around 0.85 per cent of the divisible pool. We believe that there is a strong case for enhancing this to 1 per cent of the divisible pool in order to meet the security and other special needs of the Union Territories of Jammu and Kashmir and Ladakh.
Since this enhancement has to be met from the Union' Government's resources (through Ministry of Home Affairs), we recommend that aggregate share of States may be reduced by 1 percentage point to 41 per cent of the divisible pool.”
So basically, FFC has not recommended the transfer of taxes to Jammu & Kashmir and Ladakh Union Territories for the period 2020-21.
Answer: (c)
The Finance Commission recommends for devolution of taxes (from the divisible pool) from Centre to States only (called Vertical devolution) and is not meant for UTs, whether they have their own assembly/legislature or not.
The Fifteenth Finance Commission (FFC) recommendations will be applicable for six years period from 2020-21 to 2025-26. For the year 2020-21, the recommendations have been submitted and the final recommendations for the five-year period 2021-22 to 2025- 26 will be submitted by October 2020.
FFC quoted:
“The State of Jammu & Kashmir was reorganised into the Union Territories (UT) of Ladakh and Jammu & Kashmir through the Jammu & Kashmir Reorganisation Act, 2019. Article 280 of the Constitution, along with the Jammu and Kashmir Reorganisation Act puts the newly-created UTs of Ladakh and Jammu and Kashmir outside the purview of the Finance Commission's award.
Since UTs are the responsibilities of the Union, they are within the purview of the Union budget. We have notionally estimated that the share of the erstwhile State of Jammu & Kashmir would have come to around 0.85 per cent of the divisible pool. We believe that there is a strong case for enhancing this to 1 per cent of the divisible pool in order to meet the security and other special needs of the Union Territories of Jammu and Kashmir and Ladakh.
Since this enhancement has to be met from the Union' Government's resources (through Ministry of Home Affairs), we recommend that aggregate share of States may be reduced by 1 percentage point to 41 per cent of the divisible pool.”
So basically, FFC has not recommended the transfer of taxes to Jammu & Kashmir and Ladakh Union Territories for the period 2020-21.
Answer: Option A. -> Value Added Tax (VAT)
Answer: (a)
Answer: (a)
Answer: Option B. -> 1, 2 and 3
Answer: (b)Corporation Tax, Wealth Tax and Income Tax are in the category of direct tax.
Answer: (b)Corporation Tax, Wealth Tax and Income Tax are in the category of direct tax.
Answer: Option B. -> Both (i) & (ii)
Answer: (b)
Answer: (b)
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