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Taxation as a Tool

I: The State ...

Question

I: The State Government has announced special tax package for the new industries to be set-up in the State.
II: Last year the State Government had hiked the taxes for all industrial activities in the State.

A

Statement I is the cause and statement II is its effect.

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B

Statement II is the cause and statement I is its effect.

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C

Both the statements I and II are independent causes.

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D

Both the statements I and II are effects of independent causes.

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E

Both the statements I and II are effects of some common cause.

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Solution

The correct option is C Statement II is the cause and statement I is its effect.
Because of hike in taxes that happened last year, this year government has announced special tax packages to make the process easier for new industries.
Thus, II is the cause which resulted in adoption of I.
Hence, Option B is correct.

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