2000 General Studies, all questions
UPSC Prelims 2000 · General Studies
Question 7: Economy and Social Development
The Standing Committee of State Finance Ministers recommended in January 2000 uniform rates across the States in respect of
avalue-added tax
bsales tax
cstamp duty and registration fees
dagricultural income tax
AnswerThe answer is (b).
In January 2000 the State Finance Ministers' committee agreed on uniform floor rates of sales tax across States, to stop States undercutting each other to attract trade and industry; it was a step toward VAT. Value-added tax itself was introduced by most States only in April 2005, so it was not what was recommended in January 2000.
Why each option is right or wrong
- (a) VAT came later; most States adopted it only in 2005. The 2000 recommendation was about floor rates of sales tax.
- (b) Right: uniform floor rates for sales tax were the recommendation.
- (c) Stamp duty and registration fees were not part of this move.
- (d) Agricultural income tax was not part of this recommendation.
Explanation: written by UPSC Grade, not by UPSC.
Source: UPSC, Civil Services (Preliminary) Examination 2000, General Studies. UPSC's own paper isn't online; the words are from a published compilation. The paper on upsc.gov.in.