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Public Finance Questions and Answers | Public Finance MCQs

(1) If a person who is tax-payer can shift the burden of tax to someone else, the tax is called:
[A] Movable tax
[B] Indirect tax
[C] Transfer tax
[D] Undesirable tax
Answer: Indirect tax
(2) The federal budget of Pakistan includes:
[A] Direct taxes and indirect taxes
[B] Proportional and progressive taxes
[C] Simple and difficult taxes
[D] (a) & (b) of above
Answer: (a) & (b) of above

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(3) To bring equitable distribution of income in the country taxes should be
[A] Direct
[B] Indirect
[C] Proportional
[D] Progressive
Answer: Progressive
(4) These are principles of taxation:
[A] Equality and certainty
[B] Certainty and morality
[C] Flexibility and durability
[D] Durability and rigidity
Answer: Equality and certainty
(5) It is better way to finance the govt. budget:
[A] By taxing people
[B] By printing new money
[C] By borrowing from banks
[D] By fining people doing illegal activities
Answer: By taxing people
(6) Income tax in Pakistan is:

[A] Direct and progressive
[B] Direct and proportional
[C] Indirect and progressive
[D] Indirect and proportional
Answer: Direct and progressive
(7) In Pakistan, income tax is collected by:
[A] Local govt
[B] Provincial govt.
[C] Federal govt.
[D] All governments
Answer: Federal govt.
(8) Sales tax in Pakistan is:
[A] Direct and progressive
[B] Direct and proportional
[C] Indirect and progressivees
[D] Indirect and proportional
Answer: Indirect and proportional
(9) It is easy and convenient to pay:
[A] Direct tax
[B] Indirect tax
[C] Proportional tax
[D] Progressive tax
Answer: Indirect tax
(10) It is difficult to evade:
[A] Direct tax
[B] Indirect
[C] Proportional
[D] Progressive tax
Answer: Direct tax

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