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प्रश्न
An indirect tax can be made progressive by imposing higher tax rates on luxuries. Justify the above statement.
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उत्तर
The statement that "an indirect tax can be made progressive by imposing higher tax rates on luxuries" can be justified as follows:
- Indirect taxes, such as sales tax or VAT, are commonly regarded as regressive because they apply the same rate to all individuals, regardless of income.
- However, this system can be made more progressive by imposing greater taxes on luxury products and services primarily consumed by the wealthy.
- By raising tax rates on luxuries such as luxury automobiles, jewellery, designer clothes, and high-end equipment, the tax burden is more concentrated among individuals with higher incomes who can afford them.
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संबंधित प्रश्न
Instrument of monetary policy is:
Match the following:
| Column I | Column II | ||
| A. | Impact of tax | (i) | Price stability |
| B. | Incidence of tax | (ii) | Simple to calculate |
| C. | Objective of Monetary Policy | (iii) | Ultimate burden of tax |
| D. | Proportional tax | (iv) | Original imposition of tax |
Read the following statements carefully and choose the correct alternative:
Assertion (A): Income tax is a direct tax.
Reason (R): GST is an indirect tax.
Name any two instruments of Fiscal Policy.
Define direct tax
Give an example of Indirect tax.
Explain the term proportional taxation.
Give two reasons why the government imposes tax?
Explain how indirect taxes can be inflationary.
How does the state fulfil the following socio-economic objective?
Reducing income inequality.
