AP State Syllabus 9th Class Social Studies Important Questions 11th Lesson The Government Budget and Taxation
9th Class Social 11th Lesson The Government Budget and Taxation 1 Mark Important Questions and Answers
Give examples of Indirect and direct taxes. (SA-III : 2016-17)
Example of Direct tax :
1) Income tax
2) Corporate tax
Example of Indirect tax :
1) Sales tax
2) VAT, entertainment tax etc.
9th Class Social 11th Lesson The Government Budget and Taxation 2 Marks Important Questions and Answers
Read the paragraph and comment on it. (SA-II : 2017-18)
The increase in the price of petrol and diesel has led to an all round increase in prices. Fruits, vegetables, pulses and other food items, for example, have become more expensive.
- Increase in the prices of diesel and petrol leads to the increase in the cost of transportation.
- Which in turn rise the prices of important commodities like fruits, vegetables pulses and other food items have become more expensive.
Raghav earns Rs. 20,000 per month. Given in the table below is his monthly family budget. Read the table to answer the question. (SA-II : 2018-19)
|Item||Expenditures in Rs (per month)|
|Education of 2 Children||2,500|
|Transportation||4,500 (Rs. 75 per litre and 2 litre per day)|
The government has decided to increase the prices of petrol by Rs. 3 per litre.
What will happen to Raghav’s family budget? And how will it effect his family?
- The increase in the price of petrol influence the every family’s expenditure.
- Raghava’s family budget on transportation is increasing from Rs. 4,500 to 4,680 due to hike in petrol prices.
- Along with transportation important daily commodities prices also increases.
- So, Raghava family should reduce their daily expenditure to fulfill needs. It effect on Raghava’s family very badly.
9th Class Social 11th Lesson The Government Budget and Taxation Important Questions and Answers
What are taxes? How are they classified?
- Taxes are the compulsory payments and are the main sources of revenue for the government.
- The taxes are broadly classified into two categories,
a) Direct taxes
b) Indirect taxes.
Write about Direct taxes.
- The taxes that are directly levied on the individuals are direct taxes.
- e.g.: Income tax and corporate tax.
- The incidence and the effect will be on the same person.
Write about indirect tax.
The indirect taxes are that type of taxes where tax is levied on one person but the tax burden is shifted to some other person.
e.g.: Sales tax, excise tax, customs tax, VAT, entertainment tax, etc.
What is subsidy? Why do you think government provides subsidy?
- Money paid by government to reduce the cost of certain important goods such as fertilizers, foodgrains, diesel and other important goods so that their prices can be kept low and affordable to all.
- Government provides subsidies for many products by compensating the producer.
- Otherwise, producers may charge higher prices and products may be out of reach for poor.
- Subsidised prices keep goods affordable especially for those who need it most.
- In this way, government subsidises the price of kerosene, foodgrain from ration shops, LPG gas cylinders, etc.
What is revenue? Why is it necessary for government?
- The money required for the different functions of the government is collected as taxes.
- The taxes collected constitute the revenue of the government.
- Revenues are necessary to finance the expenditures of the government.
- To fulfil various roles, the government must have adequate money, which it gets from taxes.
Name a few taxes.
Value Added Tax (VAT), Service tax, Excise duty, Income tax, Property tax, Customs duty, etc.
What is service tax ? Give a few examples.
- The tax on services is called ‘service tax’.
- Some common examples of service tax include speed post, telephone, mobile communication, restaurants, AC class/first class train travel.
Nowadays black money is hoarding. Make suggestions to government to get rid of it.
- There are many ‘tax evaders’ and the black money, that is the money on which tax should have been paid but wasn’t goes on accumulating.
- To get hold of this hoard of black money the income tax departmentraids many people’s
- It has also tried to make the procedures more convenient for people to pay their own tax.
- Despite these efforts a large number of people do not pay income tax, or pay less than they should.
Government gets money from taxes. What considerations should be made while collecting taxes?
- The government gets money from many kinds of taxes.
- It has to decided how much money to collect through each kind of tax.
- It has to consider : how many people would have to pay, whether this tax can be collected easily, how would it affect rich and poor; A related question is whether people pay their taxes or evade it.
What taxes are to be avoided in order to save the poor from the burden of taxation?
- Tax on petrol and diesel leads to an all round increase in prices. Hence they are to be avoided.
- Indirect taxes do not distinguish between the rich and the poor. They are to be reduced.
- Taxes on essentials are to be reduced and tax on luxury items can be increased.
What measures are to be taken by government to have a fair taxation?
- Taxation depends on the value that the society as a whole holds.
- Most societies have a few people who have lakhs of rupees while others don’t have enough to eat.
- Government should collect more taxes from the rich and the poor should be taxed minimally.
- Society can aspire to spend these taxes to raise the income of the poor by providing better opportunities and living conditions.
What measures are to be taken by government in increasing taxes in budget?
- Taxes charged and collected have a strong impact on people’s lives.
- The tax on income falls more heavily on the rich and therefore can be considered more fair.
- But the taxes from income might not be enough to cover the large government expenditure.
- Any budget has to take into account all these considerations.
- That is why the time of the budget is of great importance for everyone.