As per the Budget Estimates of 2019-20, the following are some of the important sources of tax receipts for the Union Government:
- Corporation Tax
- Taxes on Income other than Corporation Tax
- Goods and Services Tax
- Union Excise Duties
Which one of the following is the correct descending order of the aforesaid tax receipts as a· percentage of GDP?
- AOption (a)
I, 2, 3, 4
- BOption (b)
1, 3, 2, 4
- COption (c)
3, 2, 1, 4
- DOption (d)
2, 4, 3, 1
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Correct answer
1, 3, 2, 4
Why this answer is correct
The correct answer is 1, 3, 2, 4.
Key Points
- For every rupee with the government —offer, 68 paise came from the direct & indirect taxes while the states' share of taxes & duties is the single-largest expense head accounting for 23% of the total spending as per the 2019-20 budget.
- As per the Budget for 2019-20 presented in the Parliament by Finance Minister Nirmala Sitharaman, GST collections contributed 19 paise in every rupee revenue collection.
- The Corporation tax is the single largest source of income, contributing 21 paise to each rupee earned.
- The collection from borrowings & other liabilities will be 20 paise whereas income tax will yield 16 paise to every rupee collection.
- The govt. intends to earn 9 paise from the non-tax revenue like disinvestment, 8 paise from the Union excise duty, 4 paise from the customs, and 3 paise from the non-debt capital receipts in every rupee collection.
- On that of the expenditure side, the biggest outlay component is the states' share of the taxes & duties at 23 paise, followed by the interest payment at 18 paise.