The concept of 'Horizontal Equity' in taxation requires that: MCQ with Answer and Explanation

Question

Share Report Error

The concept of 'Horizontal Equity' in taxation requires that:

A. Taxes should be independent of ability to pay

B. Individuals with the same ability to pay should pay the same tax

C. Only vertical equity matters

D. Individuals with higher ability to pay should pay proportionally more

Answer: Option B

Solution (By JKSSB Mock Tests)

Horizontal equity is the principle that taxpayers with equal capacity to pay (usually measured by income or wealth) should bear equal tax burdens.

This question belongs to: Economy GK Economy Set 1

Request complete Subject PDF

Discuss this Question (0)

No comments yet. Be the first to start the discussion!

Practice More Economy Set 1 Questions

Question #1

The term 'Special Drawing Rights' (SDRs) is associated with:

A. Asian Development Bank

B. International Monetary Fund

C. World Bank

D. World Trade Organisation

View Answer & Solution Discuss

Get Complete Subject PDF for Economy GK

Correct Answer: Option B

Explanation:
Special Drawing Rights are an international reserve asset created by the International Monetary Fund to supplement member countries' official reserves.

This question belongs to: Economy GK Economy Set 1

Question #2

The 'strategic sale' in disinvestment means:

A. sale of controlling shareholding to a private or strategic buyer

B. merger of two PSUs

C. sale of shares in the stock market

D. buyback of shares

View Answer & Solution Discuss

Get Complete Subject PDF for Economy GK

Correct Answer: Option A

Explanation:
Strategic sale involves transfer of management control.

This question belongs to: Economy GK Economy Set 1

Question #3

The term 'Base Year' in national income accounting is important because it:

A. Provides the price structure for calculating real GDP

B. Determines the tax rates

C. Determines the fiscal deficit target

D. Fixes the exchange rate

View Answer & Solution Discuss

Get Complete Subject PDF for Economy GK

Correct Answer: Option A

Explanation:
The base year supplies the constant price weights used to compute real GDP and other volume measures, enabling meaningful comparisons over time.

This question belongs to: Economy GK Economy Set 1

Explore All Economy Set 1 MCQs