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Question
How does the state fulfil the following socio-economic objective?
Reducing income inequality.
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Solution
- Income inequality is very harmful to the society as a whole. The state can reduce income inequality through the system of progressive taxation, nationalisation of private industries and also by providing free education and medical facilities to the poor.
- By setting up public sector enterprises, the government can generate lots of new jobs for the unemployed.
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RELATED QUESTIONS
______ are those taxes which are paid by the same person on whom they have been imposed.
Taxes in which the rate of tax remains the same, though the tax bases changes are called ______.
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| Column I | Column II | ||
| A. | Direct tax | (i) | Tax rate increases with tax base |
| B. | Indirect tax | (ii) | Tax rate remains constant |
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| D. | Progressive tax | (iv) | Impact and incidence lie on the same person |
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