The Goods and Services Tax (GST) is being flaunted as the single-biggest economic reform since the economic liberalisation of 1991. Even critics of the tax, who complain about its complex four-slab rate structure, agree that it is a step in the right direction. The primary reason is that it does away with the present system of multiple Central and State taxes, replacing it with a much simpler tax system. __________________________. In the process, it is said, the new tax system does away with the barriers to free trade within and between States, effectively turning India into a single free market for goods and services.
Two, the number of taxes does not necessarily reflect the actual burden imposed on businesses by any tax system.
Incorrect AnswerAnother supposed benefit of GST is that it is a tax on consumption, which replaces the current web of ‘cascading’ taxes in the production chain that increases prices and distorts production.
Correct AnswerA single, low tax rate might also turn out to be more burdensome if the cost of bureaucratic compliance is higher than under multiple, higher tax rates.
Incorrect AnswerSuch distortion of production can lead to the rise in the prices of certain goods due to lower supply and a fall in the prices of others due to greater supply, which is clearly not the same as a general increase in prices.
Incorrect AnswerFor sceptics, there is good reason to doubt all these claimed benefits of the GST.
Incorrect AnswerExplanation:
Correct Answer is (b).The sentences preceding the blank talk about the benefits of the implementation of the GST. The sentence immediately preceding the blank states the primary reason for the appreciation the GST is receiving even by its critics. Clearly, the sentence for the blank has to be in line with the same chain of thoughts.
Among the sentences given as options, sentence B specifies another benefit of GST in the context. The sentence most appropriately fits the blank.
Option B is hence the correct answer.
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By: Abhishek kumar