Question

How does GST tackle smuggling of goods?

• A. It imposes varied tax rates across the country.
• B. It imposes uniform tax rates across the country.
• C. It imposes zero taxes across the country.
• D. It imposes flexible tax rates across the country.

Answer 1

The correct option is B It imposes uniform tax rates across the country.

Before the introduction of GST, the government imposed various indirect taxes. The indirect tax varied across multiple states, so some people bought goods illegally from other states without paying taxes. This is known as smuggling. However, when GST was imposed, there was one uniform tax rate across the country. This way, people pay the same tax in any state, and smuggling is checked.