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प्रश्न
Citing reason state the advantage of a progressive tax over proportional tax.
थोडक्यात उत्तर
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उत्तर
- Progressive tax systems are created to charge a higher tax rate on persons or businesses with higher incomes, providing a benefit of equity and fairness.
- Proportional tax affects low-income earners and high income earners equally. But a progressive tax has more financial impact on high income earners than on low income earners. That is why a progressive tax is considered better and more fair.
- Example: In a progressive system, a person earning ₹ 100,000 per year may pay 25% in taxes, while someone earning ₹ 30,000 may pay only 10%. A proportionate tax system would require both to pay the same percentage, say 15%, with the lower-income person bearing most of the cost.
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संबंधित प्रश्न
Instrument of monetary policy is:
Match the following and select the correct option:
| Column A | Column B | ||
| (i) | Taxes imposed on income and wealth | A. | Regressive |
| (ii) | Taxes imposed on goods and services | B. | Progressive |
| (iii) | A tax system where the rate of tax decreases with increase income | C. | Direct taxes |
| (iv) | A tax system where the rate of tax increases as income increase | D. | Indirect taxes |
Which of the following taxes generate civic consciousness among people?
Define fiscal policy.
State two objectives of fiscal policy.
What are progressive taxes.
An indirect tax can be made progressive by imposing higher tax rates on luxuries. Justify the above statement.
State two differences between income tax and commodity tax.
Explain briefly two merits of indirect tax.
Citing reasons state the superiority of Progressive tax over regressive tax.
