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Daily Quiz

Economics

GST



Question.

Consider the following statements:


1. At the central level, Corporate Tax and Income Tax are subsumed under the GST.
2. IGST would come into picture when there is an inter-state transfer of goods and services
3. At the state level, VAT, Central Sales Tax, Octroi etc. is subsumed under the GST.

Choose the correct answer from the code given below:

A. 1 and 3 only
B. 3 only
C. 2 and 3 only
D. All of the above

Answer: C

Explanation:

At the central level, following taxes are being subsumed under GST:
• Central Excise Duty
• Additional Excise Duty
• Service Tax
• Countervailing Duty
• Special Additional Duty of Customs

At the state level, following taxes are being subsumed under GST:
• State VAT/Sales Tax
• Entertainment Tax
• Central Sales Tax
• Octroi and Entry Tax
• Purchase Tax
• Luxury Tax
• Taxes on lottery, betting and gambling

GST subsumes Indirect Tax and not the Direct Tax, so Income Tax and Corporate Tax are not subsumed under the GST as they are direct tax. Hence, statement 1 is incorrect.
IGST would come into picture when there is an inter-state transfer of goods and services (u/a 269A(1)). IGST rate would be roughly equal to the sum of CGST and SGST.
Purpose of the Question:
In a recent meeting of GST Council, the exemption limit for GST Compliance has been increased from Rs. 20 lakh to Rs. 40 lakh for General category states and from Rs. 10 lakh to Rs. 20 lakh for North Eastern and Hilly states.

Source: The Hindu

Economics

Merger Of Banks



Question:

Consider the following statement vis-à-vis recent merger of Vijaya Bank, Bank of Baroda & Dena Bank?

1. This merger is the outcome of ‘Alternative Mechanism’ panel which was set up under N. R. Narayanmurthy.
2. Bank of Baroda will be the Transferor bank while Vijaya Bank and Dena Bank will be the transferee bank.
3. The merged entity will become the third largest bank of the country.

Choose the correct answer from the code given below:

A. 3 only
B. 1 and 3 only
C. 1, 2 and 3
D. None of the above

Answer: A

Explanation:
The recent merger of the three banks will lead to creation of the third largest entity after SBI and ICICI Banks in India. The Bank of Baroda is the largest of the three banks and will be the transferee bank while Vijaya Bank and Dena Bank will be the Transferor Bank. Hence, statement 2 is incorrect.
How this Merger idea came up?
Streamlining of the banks and their merger was first mooted by Narasimham committee in 1998, but the present merger is the outcome of ‘Alternative Mechanism Panel’ headed by Shri Arun Jaitley which proposed to merge a weak bank with two strong banks.

Source: Livemint