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Questions
State two differences between income tax and commodity tax.
State two difference between tax on income and tax on a commodity.
Mention two points of distinction between tax on income and tax on commodity.
Distinguish Between
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Solution
| S. No. | Income tax | Commodity tax |
| 1. | Income tax is a direct tax. | Tax on a commodity is an indirect tax. |
| 2. | Tax burden of income tax cannot be shifted to another. | tax burden on a commodity can be shifted wholly or particularly on to its buyers in the form of higher prices. |
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Role of State in Economic Development
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Chapter 6: The State and Economic Development - QUESTION BANK [Page 189]
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RELATED QUESTIONS
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 |
Identify the tax which is most likely to faster civic conciousness.
How can tax be used as an instrument to bring about equitable distribution of wealth and income?
Define direct tax
Classify the following type of tax into direct and indirect taxes:
Sales tax
Give one example of progressive tax.
State two drawbacks of direct taxes.
How does the state fulfil the following socio-economic objective?
Environmental protection.
State three demerits of an Indirect tax.
Explain the term Incidence of a tax.
