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With reference to contribution from taxes, consider the following statements:
1. Contribution from direct taxes is more than that from indirect taxes.
2. Corporation tax is the largest contributor.
Which of the statements given above is/are correct ?
- a)1 only
- b)2 only
- c)Both 1 and 2
- d)Neither 1 nor 2
Correct answer is option 'C'. Can you explain this answer?
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With reference to contribution from taxes, consider the following stat...
Answer: (c) Both 1 and 2.
Since 2007-08, the contribution of direct tax has been more than indirect tax. Before this, the trend was opposite. Corporation tax is the largest contributor among the taxes.
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With reference to contribution from taxes, consider the following stat...
Explanation:
Statement 1: Contribution from direct taxes is more than that from indirect taxes.
- Direct taxes are taxes that are levied on individuals or entities, which cannot be transferred to others. Examples include income tax, wealth tax, etc.
- Indirect taxes are taxes that can be transferred to others, such as sales tax, excise tax, etc.
- According to the Budget 2021-22, the contribution from direct taxes is estimated to be Rs. 9.05 lakh crore, while the contribution from indirect taxes is estimated to be Rs. 10.01 lakh crore. Therefore, statement 1 is incorrect.
Statement 2: Corporation tax is the largest contributor.
- Corporation tax is a direct tax that is levied on the income or profits of companies or firms.
- According to the Budget 2021-22, the estimated contribution from corporation tax is Rs. 4.57 lakh crore, which is the highest among all direct taxes. Therefore, statement 2 is correct.
- However, the highest contributor overall is still the Goods and Services Tax (GST), which is an indirect tax, with an estimated contribution of Rs. 6.30 lakh crore.
Therefore, statement 2 is correct, but statement 1 is incorrect. The correct answer is option C (Both 1 and 2).
Statement 1: Contribution from direct taxes is more than that from indirect taxes.
- Direct taxes are taxes that are levied on individuals or entities, which cannot be transferred to others. Examples include income tax, wealth tax, etc.
- Indirect taxes are taxes that can be transferred to others, such as sales tax, excise tax, etc.
- According to the Budget 2021-22, the contribution from direct taxes is estimated to be Rs. 9.05 lakh crore, while the contribution from indirect taxes is estimated to be Rs. 10.01 lakh crore. Therefore, statement 1 is incorrect.
Statement 2: Corporation tax is the largest contributor.
- Corporation tax is a direct tax that is levied on the income or profits of companies or firms.
- According to the Budget 2021-22, the estimated contribution from corporation tax is Rs. 4.57 lakh crore, which is the highest among all direct taxes. Therefore, statement 2 is correct.
- However, the highest contributor overall is still the Goods and Services Tax (GST), which is an indirect tax, with an estimated contribution of Rs. 6.30 lakh crore.
Therefore, statement 2 is correct, but statement 1 is incorrect. The correct answer is option C (Both 1 and 2).
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With reference to contribution from taxes, consider the following statements:1. Contribution from direct taxes is more than that from indirect taxes.2. Corporation tax is the largest contributor.Which of the statements given above is/are correct ?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'C'. Can you explain this answer?
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