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Direct & Indirect Taxes

Statement: Sh...

Question

Statement: Should income tax be abolished in India?
Arguments:
I. Yes. It is an unnecessary burden on the wage earners.
II. No. It is a good source of revenue.

A

Only argument I is strong

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B

Only argument II is strong

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C

Either I or II is strong

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D

Neither I nor II is strong

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E

Both I and II are strong

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Solution

The correct option is D Only argument II is strong
Income-tax is levied so that every citizen can contribute a share of his earning towards the infrastructural development of the nation. So, argument I seems to be vague. However, income-tax is no doubt a good source of revenue for the government. Hence, argument II holds strong.

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