Laxmikanth MCQs: Goods and Services Tax Council | Indian Polity for UPSC CSE PDF Download

Q1: Statement 1: The Goods and Services Tax Council was established under Article 279-A of the Indian Constitution.
Statement 2: The GST Council's main office is located in Mumbai.
Statement 3: The Union Revenue Secretary is the Secretary to the GST Council.
Choose the correct option:
(a) Statement 1 and 2 are correct
(b) Statement 1 and 3 are correct
(c) Statement 2 and 3 are correct
(d) All statements are correct
Ans: (b)
The GST Council was indeed established under Article 279-A, and the Union Revenue Secretary serves as its Secretary. However, the main office is in New Delhi, not Mumbai.

Q2: Statement 1: The GST Council plays a role in determining the date when GST is applied to certain items like petroleum products
Statement 2: The Council is responsible for managing the foreign trade policies of India.
Choose the correct option:
(a) Only Statement 1 is correct
(b) Only Statement 2 is correct
(c) Both statements are correct
(d) Neither statement is correct
Ans: (a)
The GST Council does recommend dates for applying GST to certain items, including petroleum products. However, it does not manage foreign trade policies, which is outside its purview.

Q3: Statement 1: Decisions in the GST Council require a simple majority.
Statement 2: The central government's vote has a weightage of two-thirds in the Council.
Choose the correct option:
(a) Only Statement 1 is correct
(b) Only Statement 2 is correct
(c) Both statements are correct
(d) Neither statement is correct
Ans: (d)
Decisions in the GST Council require a three-fourths majority, and the central government's vote has a one-third weightage.

Q4: Assertion (A): The GST Council is a constitutional federal body with decision-making power.
Reasoning (R): The vision of the GST Council is to establish cooperative federalism.
Choose the correct option:
(a) Both A and R are true, and R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is true, but R is false
(d) A is false, but R is true
Ans: (b)
Both statements are true. However, the reason for the GST Council being a constitutional body is not solely due to its vision but due to its establishment under Article 279-A.

Q5: Arrange the following functions of the GST Council in the order they were mentioned:
A. Setting GST rates
B. Recommending compensation to states
C. Deciding on goods and services included in GST
D. Recommending application dates for GST on certain items
(a) C, A, B, D
(b) A, C, D, B
(c) B, D, A, C
(d) D, B, C, A
Ans: (a)
The order of functions as mentioned is first deciding on goods and services for GST, then setting GST rates, recommending compensation to states, and finally recommending application dates for certain items.

Q6: Statement 1: The GST Council is responsible for formulating Model GST Laws.
Statement 2: The Council sets a threshold limit of turnover for GST exemption.
Statement 3: The Council has no role in determining special rates for natural calamities.
Choose the correct option:
(a) Statements 1 and 2 are correct
(b) Statements 2 and 3 are correct
(c) Statements 1 and 3 are correct
(d) All statements are correct
Ans: (a)
The GST Council is indeed responsible for formulating Model GST Laws and setting a threshold limit for GST exemption. However, it also has the authority to determine special rates for a specific period during natural calamities, making Statement 3 incorrect.

Q7: Statement 1: The GST Council includes the Union Finance Minister and the Union Minister of State for Revenue or Finance.
Statement 2: Each state nominates its Chief Minister to be part of the GST Council.
Choose the correct option:
(a) Only Statement 1 is correct
(b) Only Statement 2 is correct
(c) Both statements are correct
(d) Neither statement is correct
Ans: (a)
The Union Finance Minister and the Union Minister of State for Revenue or Finance are indeed part of the GST Council. However, each state nominates a Minister in charge of Finance or Taxation, not necessarily the Chief Minister.

Q8: Assertion (A): The GST Council has the authority to create special provisions for certain states.
Reasoning (R): This is to address the unique economic and geographical challenges of these states.
Choose the correct option:
(a) Both A and R are true, and R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is true, but R is false
(d) A is false, but R is true
Ans: (a)
The GST Council does have the authority to create special provisions for certain states, often due to their unique economic and geographical challenges.

Q9: Which of the following is not a function of the GST Council?
(a) Deciding which goods and services should be included or excluded from GST
(b) Establishing principles for determining the place of supply
(c) Setting the national minimum wage
(d) Determining GST rates, including floor rates with bands
Ans: (c)
Setting the national minimum wage is not a function of the GST Council. The other options are among its responsibilities.

Q10: Statement 1: Any vacancy or issue in the Council's formation invalidates its proceedings.
Statement 2: The Council also recommends compensation to states for loss of revenue due to the introduction of GST.
Choose the correct option:
(a) Only Statement 1 is correct
(b) Only Statement 2 is correct
(c) Both statements are correct
(d) Neither statement is correct
Ans: (b)
The Council indeed recommends compensation to states for loss of revenue. However, a vacancy or issue in the Council's formation does not invalidate its proceedings, making Statement 1 incorrect.

Q11: Statement 1: The Goods and Services Tax Council was established by an amendment to the Indian Constitution in 2016.
Statement 2: The GST Council operates independently of the central and state governments.
Choose the correct option:
(a) Only Statement 1 is correct
(b) Only Statement 2 is correct
(c) Both statements are correct
(d) Neither statement is correct
Ans: (a)
The GST Council was indeed established by a constitutional amendment in 2016, but it does not operate independently; it involves both central and state governments for coordination and cooperation on GST matters.

Q12: Who among the following can be a member of the Goods and Services Tax Council?
(a) Prime Minister of India
(b) Governor of a State
(c) Minister in charge of Finance or Taxation in a State Government
(d) Chief Justice of India
Ans: (c)
The GST Council includes the Union Finance Minister, Union Minister of State for Revenue or Finance, and Ministers in charge of Finance or Taxation from each state government.

Q13: What is the primary vision of the GST Council?
(a) To increase the central government's revenue
(b) To establish the highest standards of cooperative federation
(c) To promote foreign trade and investment
(d) To decentralize financial power to the states
Ans: (b)
The primary vision of the GST Council is to establish the highest standards of cooperative federation in its functioning, promoting a harmonized tax structure across the country.

Q14: In the GST Council, how is the voting weight distributed between the central and state governments?
(a) Central government: 50%, State governments: 50%
(b) Central government: 33%, State governments: 67%
(c) Central government: 75%, State governments: 25%
(d) Central government: 25%, State governments: 75%
Ans: (b)
In the GST Council, the central government's vote has a weightage of one-third, while the combined votes of all state governments have a two-thirds weightage.

Q15: Assertion (A): The GST Council is empowered to determine the threshold limit of turnover for GST exemption.
Reasoning (R): This helps in protecting small businesses from the complexities of GST compliance.
Choose the correct option:
(a) Both A and R are true, and R is the correct explanation of A
(b) Both A and R are true, but R is not the correct explanation of A
(c) A is true, but R is false
(d) A is false, but R is true
Ans: (a)
The GST Council has the authority to set a threshold limit for GST exemption, which indeed helps small businesses by reducing their tax compliance burden.

Q16: Which of the following is a function of the GST Council?
(a) Appointment of Judges to the Supreme Court
(b) Regulation of interstate commerce and trade
(c) Formulation of Model GST Laws
(d) Setting foreign policy guidelines
Ans: (c)
One of the key functions of the GST Council is to formulate Model GST Laws, which provide a framework for the implementation of GST across the country.

Q17: Statement 1: The GST Council's decisions require a unanimous vote to pass.
Statement 2: The Council has the power to decide on special rates during natural calamities.
Choose the correct option:
(a) Only Statement 1 is correct
(b) Only Statement 2 is correct
(c) Both statements are correct
(d) Neither statement is correct
Ans: (b)
Decisions in the GST Council do not require a unanimous vote but a three-fourths majority. The Council does have the authority to decide on special rates during natural calamities.

Q18: The Vice-Chairperson of the GST Council is chosen from among:
(a) The Governors of the States
(b) The Chief Ministers of the States
(c) The State Finance Ministers
(d) The Members of Parliament
Ans: (c)
The Vice-Chairperson of the GST Council is chosen from among the state members, typically the State Finance Ministers.

Q19: Which of the following issues does not invalidate the proceedings of the GST Council?
(a) A vacancy in the Council's membership
(b) A procedural mistake by the Council
(c) An issue in appointing a person as a Council member
(d) Disagreements among members on GST rates
Ans: (d)
Vacancies, procedural mistakes, or issues in appointing members do not invalidate the proceedings of the GST Council. However, disagreements on GST rates are a natural part of the decision-making process and do not render the proceedings invalid.

Q20: Which of the following is true about the meetings of the GST Council?
(a) They require a quorum of at least two-thirds of the members.
(b) Decisions can be made without a quorum if urgent.
(c) Meetings are chaired by the President of India.
(d) A quorum requires the presence of at least half of the total members.
Ans: (d)
For a GST Council meeting to proceed, a quorum is necessary, which is defined as the presence of at least half of the total members.