Question

Assertion (A): Companies pay tax on the revenue earned from selling goods and services.

Reasoning (R): The government imposes direct tax on individuals and companies.

Choose the correct option.

• A. Both A and R are true, and R is the correct explanation of A.
• B. Both A and R are true, but R is not the correct explanation of A.
• C. A is true, but R is false.
• D. A is false, but R is true.

Answer 1

The correct option is D A is false, but R is true.

The government imposes income tax on individuals and corporate tax on Indian and foreign companies operating in India. The companies pay corporate tax on the profits earned for the year. So, the reasoning is correct, but the assertion is incorrect.