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2025 · Q5Indian EconomyTaxationmoderate

Consider the following statements : Statement I : In India, income from allied agricultural activities like poultry farming and wool rearing in rural areas is exempted from any tax. Statement II : In India, rural agricultural land is not considered a capital asset under the provisions of the Income-tax Act, 1961. Which one of the following is correct in respect of the above statements?

  1. (a)Both Statement I and Statement II are correct and Statement II explains Statement I
  2. (b)Both Statement I and Statement II are correct but Statement II does not explain Statement I
  3. (c)Statement I is correct but Statement II is not correct
  4. (d)Statement I is not correct but Statement II is correct
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Official answer(d) Statement I is not correct but Statement II is correct

2022 · Q8Indian EconomyTaxationmoderate

Which one of the following situations best reflects “Indirect Transfers” often talked about in media recently with reference to India ?

  1. (a)An Indian company investing in a foreign enterprise and paying taxes to the foreign country on the profits arising out of its investment
  2. (b)A foreign company investing in India and paying taxes to the country of its base on the profits arising out of its investment
  3. (c)An Indian company purchases tangible assets in a foreign country and sells such assets after their value increases and transfers the proceeds to India
  4. (d)A foreign company transfers shares and such shares derive their substantial value from assets located in India
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Official answer(d) A foreign company transfers shares and such shares derive their substantial value from assets located in India

2018 · Q8Indian EconomyTaxationmoderate

With reference to India's decision to levy an equalization tax of 6% on online advertisement services offered by non-resident entities, which of the following statements is/are correct ? 1. It is introduced as a part of the Income Tax Act. 2. Non-resident entities that offer advertisement services in India can claim a tax credit in their home country under the "Double Taxation Avoidance Agreements". Select the correct answer using the code given below :

  1. (a)1 only
  2. (b)2 only
  3. (c)Both 1 and 2
  4. (d)Neither 1 nor 2
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Official answer(d) Neither 1 nor 2

2017 · Q81Indian EconomyTaxationmoderate

What is/are the most likely advantages of implementing 'Goods and Services Tax (GST)' ? 1. It will replace multiple taxes collected by multiple authorities and will thus create a single market in India. 2. It will drastically reduce the 'Current Account Deficit' of India and will enable it to increase its foreign exchange reserves. 3. It will enormously increase the growth and size of economy of India and will enable it to overtake China in the near future. Select the correct answer using the code given below :

  1. (a)1 only
  2. (b)2 and 3 only
  3. (c)1 and 3 only
  4. (d)1, 2 and 3
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Official answer(a) 1 only

2016 · Q60Indian EconomyTaxationeasy

The term 'Base Erosion and Profit Shifting' is sometimes seen in the news in the context of

  1. (a)mining operation by multinational companies in resource-rich but backward areas
  2. (b)curbing of the tax evasion by multinational companies
  3. (c)exploitation of genetic resources of a country by multinational companies
  4. (d)lack of consideration of environmental costs in the planning and implementation of developmental projects
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Official answer(b) curbing of the tax evasion by multinational companies