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Public Finance & Budget — UPSC Prelims Economy previous year questions — page 5

162 solved previous year questions on Public Finance & Budget, papers from 1995 to 2022, drawn from UPSC CSE Prelims, UPSC CDS, UPPCS. Each carries the printed answer key and the explanation from the source compilation.

1. #161Full-length test
   Consider the following statements regarding 'Taxation system during Mahajanpadas period': 1. Bali was a form of tax imposed by the kings upon the rich traders. 2. An 'bhagadugha' collected a share of the agricultural produce as a tax from the peasants. 3. The profession of crafting, hunting, and gathering were tax -free during this period.How many of the above given statements are correct?
   • AOnly one
   • BOnly two
   • CAll three
   • DNone
   Answer: (A) Only one
   Explanation

   Option a is the correct the rulers of the Mahajanpadas were building huge maintaining big armies, they needed more they needed officials to collect these. So, instead on occasional gifts brought by people, as in of the raja of the janapadas, they started l is incorrect: Bali was a tax imposed based area of cultivable land and not upon the rich was obtained as a share of the produce. Kara were some of the other taxes collected during 2 is correct: An official called bhaga i.e., a share of the agricultural of the agricultural land was done by an official 3 is incorrect: There were taxes on crafts Mahajan padas period. These could have been in of labour. For example, a weaver or a smith may to work for a day every month for the king. Herders expected to pay taxes in the form of animals and Hunters and gatherers also had to provide to the raja. Important tips Administration during Mahajanapa

2. #162Full-length test
   Which of the following measures may help in reducing the economic inequality in India?. 1. Adoption of Regressive taxation system 2. Promoting informalisation oflabour 3. Implementing a Universal Basic Income scheme { } 4. Imp'osition of Inheritance Tax 5. Provision of skill and education to allSelect the correct answer using the code given below
   • A1, 4 and 5 only
   • B2, 3 and 4 only
   • C1, 2 and 3 only
   • D3, 4 and 5 only
   Answer: (D) 3, 4 and 5 only
   Explanation

   Option d is the correct inequality is how unevenly income is a population. The less equal the higher income inequality is. Income inequality is by wealth inequality, which is the of 1 is regressive tax is a type of tax that is assessed income, in which low and high-income earners pay tax amount. This kind of tax is a bigger burden on low income earners than high-income earners. Thus, it inequality rather than decreasing in tax progressivity has been one of the the rise in income inequality in India in the 2 is incorrect: Informalisation of labour increased wage gap between the formal and the This can lead to increased income inequality workers of a company. Also, the informal labour is statutory social security benefits, which the economic 3 is correct: The idea of a universal basic is that every legal resident a country receives stipend sufficient to live above the poverty would natural

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