Question 1

All taxes come under

Accepted Answer

A)  capital receipt
B)  revenue receipt
C)  public debt
D)  public expenditure B

Question 2

Agriculture income tax is a source of revenue to

Accepted Answer

A)  central government
B)  state government
C)  local administration
D)  central and state government B

Question 3

If with the increase in income, the percentage of income collected as tax remains constant, tax will be called

Accepted Answer

A)  regressive
B)  progressive
C)  proportional
D)  neutral C

Question 4

Justice in taxation is best ensured by applying the principle of

Accepted Answer

A)  equal absolute sacrifice
B)  equal proportional sacrifice
C)  equal marginal sacrifice
D)  quid pro quo

Question 5

The merit of zero-based budgeting is that

Accepted Answer

A)  tax liability is reduced
B)  profit go up
C)  deficit financing becomes zero
D)  expenditure is rationalized

Question 6

With a regressive tax, as income

Accepted Answer

A)  increases, tax rate remains the same
B)  decrease, the tax rate decreases
C)  increases, the tax rate increases
D)  increases, the tax rate decreases

Question 7

Which committee recommended tax on agriculture holding in India?

Accepted Answer

A)  tandor committee
B)  raj committee
C)  kelkar committee
D)  dantwala committee

Question 8

Expenditure tax was introduced in India as per the recommendation of ………………

Accepted Answer

A)  nehru
B)  kaldor
C)  k. n. raj
D)  john mathai

Question 9

The concept of Zero-Based-Budget(ZBB) was given by

Accepted Answer

A)  ra musgrave
B)  j. m. keynes
C)  peter a pyhr
D)  a. h. hancen

Question 10

Repayment of public debt refers to

Accepted Answer

A)  discharging duties
B)  redemption of public debt
C)  repayment
D)  recovery

Question 11

Wealth tax was abolished in

Accepted Answer

A)  2011
B)  2012
C)  2014
D)  2015

Question 12

The ability to pay principle of taxation is logically most consistent with the normative notion of :

Accepted Answer

A)  tax neutrality
B)  horizontal equity
C)  value - added taxation
D)  vertical equality

Question 13

Octrio is levies and collected by

Accepted Answer

A)  centre
B)  state government
C)  local bodies
D)  all of the above

Question 14

A forward-shifted tax will affect

Accepted Answer

A)  buyers more than sellers
B)  sellers more than buyers
C)  buyers and sellers equally
D)  government revenues negatively

Question 15

The relationship between tax collections and tax rates has been expressed by

Accepted Answer

A)  lorenz curve
B)  engel's law
C)  laffer curve
D)  indifference curve

Question 16

Canons of budgeting was given by

Accepted Answer

A)  adam smith
B)  h d smith
C)  marshall
D)  dalton

Question 17

Which of the following canon of taxation is given by Adam Smith

Accepted Answer

A)  canon of diversity
B)  canon of simplicity
C)  canon of economy
D)  canon of productivity

Question 18

According to Wiseman and peacock, public expenditure will increase in a

Accepted Answer

A)  smooth manner
B)  reverse manner
C)  step - like manner
D)  none of the above

Question 19

The principle of maximum social advantage is concerned with

Accepted Answer

A)  taxation
B)  expenditure
C)  public debt
D)  both taxation and public expenditure

Question 20

A progressive income tax implies that

Accepted Answer

A)  the amount of tax falls with a rise in income
B)  the rate of rises with a rise in income
C)  both (a)  and (b) 
D)  the rate of tax decreases with a rise in income

Exam 1: Taxation and Budgeting: Concepts and Practices