With reference to tax revenues which of the following statements is are correct 1 Service tax is lev...........

Indian Political System Centre - State Relations

With reference to tax revenues, which of the following statements is/are correct?

1. Service tax is levied by the Centre but collected and appropriated by both the centre and the states.

2. The net proceeds of the taxes on the sale or purchase of goods in inter-state trade form a part of the consolidated fund of India. Select the correct answer using the code given below.

1 only

2 only

1 and 2 both

Neither 1 nor 2

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Explanation:

Statement 1 is correct. Taxes on services are levied by the centre but collected and appropriated by the centre and the states. Statement 2 is incorrect. The net proceeds of the taxes on the sale or purchase of goods in inter-state trade do not form a part of the consolidated fund of India.