Q. With regard to tax exemption provided to Central or states property, which of the following statements is/are correct?
1. Parliament can allow municipalities to impose taxes on property owned by the Central government.
2. Only the President can authorize the Centre to impose tax on commercial operations of state.
Select the correct answer using the code given below
Answer: A
Notes:
Exp) Option a is the correct answer.
Statement 1 is correct. Although Centre’s property is exempted from all taxes imposed by a state or municipalities, district boards and panchayats, but Parliament is empowered to remove this ban. Hence, Parliament can allow municipalities to impose taxes on property owned by the Central government.
Statement 2 is incorrect. The commercial operations of state are exempted from the Centre’s taxation. But the Parliament (and not the President) can authorize the Center to impose tax on commercial operations of state.
