Q. Which of the following is/are the issue/s of indirect tax/taxes?
1.Regressive in nature
2.High in tax rate
3.Promotes civic consciousness
How many of the statements given above are correct?
Answer: B
Notes:
Explanation: ISSUES IN INDIRECT TAX:
- Regressive Nature: Both rich and poor are subjected to the same rate of taxation.
- Civic Consciousness: Unlike direct taxation, indirect taxation doesn’t promote much civic awareness of performing one’s duty of paying taxes as taxes are hidden in the price in indirect taxation.
- High Tax Rate: On automobiles and building & construction material at a time when demand conditions are compressed has caused further slowdown in these sectors.
Source: FORUMIAS
