If indirect taxes are ₹200 crore and subsidies are ₹70 crore, what is NIT?
Answer and explanation
Correct answer: ₹130 crore
Net Indirect Taxes are found by subtracting subsidies from indirect taxes: NIT = Indirect Taxes − Subsidies. Hence, NIT = ₹200 crore − ₹70 crore = ₹130 crore. Subsidies reduce the net tax burden, so adding the two amounts to obtain ₹270 crore would be incorrect.
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What is the correct answer to this question?
₹130 crore
Why is this the correct answer?
Net Indirect Taxes are found by subtracting subsidies from indirect taxes: NIT = Indirect Taxes − Subsidies. Hence, NIT = ₹200 crore − ₹70 crore = ₹130 crore. Subsidies reduce the net tax burden, so adding the two amounts to obtain ₹270 crore would be incorrect.
Which subject and chapter does this question cover?
This is a Class 12 Economics question. Chapter: National Income and Related Aggregates. Topic: Aggregates related to national income - GDP.
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