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प्रश्न
How can tax be used as an instrument to bring about equitable distribution of wealth and income?
How can direct taxes reduce income inequalities.
Mention one way by which the government can reduce the disparity in income and wealth distribution of its citizens in a developing economy.
Explain two ways by which the government can reduce income inequalities in a developing economy.
How can the government help in reducing inequalities of income?
Can direct taxes reduce income inequality?
Explain how taxation can be used to reduce inequality of income.
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उत्तर
The government can reduce income inequalities in the following ways:
- Direct taxes are progressive in nature.
- Rich people are subjected to higher rates of taxation, while the poor are exempt from direct taxes.
- The policy of transfer payments (like old age pensions and unemployment allowances) can be used to transfer incomes to poor people.
- The government may subsidise the consumption expenditure of low-income groups by providing subsidised food through fair-priced shops.
- Hence, these taxes help in removing inequalities of income.
Notes
Students should refer to the answer according to their questions.
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संबंधित प्रश्न
The essential feature of a tax.
______ is an example of commercial revenues.
Observe the relationship of the first pair of words and complete the second pair:
Tax paid by person on whose it is imposed : Direct tax.
A tax is paid by some person and the final burden is born by some other person : ______.
Identify the tax which is most likely to faster civic conciousness.
The major objective of monetary policy is ______.
State two objectives of fiscal policy.
Distinguish between fiscal policy and monetary policy.
'The role of the State is important in developing the economic infrastructure of a developing economy'. Give two reasons to support your answer.
Citing reason state the advantage of a progressive tax over proportional tax.
To which tax is this shifting of tax burden relevant?
