Which of the following statements are correct?
(A) Production subsidies are received independent of the volume of production.
(B) Service tax is a production tax.
(C) Product subsidies are received per unit of product.
(D) Land revenue is a product tax.
(E) Export duty is a product tax.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → (A), (C) and (E) only
Production taxes and subsidies do not depend on the volume of production. Product taxes and subsidies are paid or received per unit.
(A) Production subsidies are received independent of the volume of production. — True. Production subsidies are independent of the volume of production.
(B) Service tax is a production tax. — False. Service tax is a product tax.
(C) Product subsidies are received per unit of product. — True. Product subsidies are received per unit.
(D) Land revenue is a product tax. — False. Land revenue is a production tax.
(E) Export duty is a product tax. — True. Export duty is a product tax.
NCERT (2026-27): “2.2.4 Factor Cost, Basic Prices and Market Prices … Production taxes and subsidies are paid or received in relation to production and are independent of the volume of production such as land revenues, stamp and registration fee. Product taxes and subsidies, on the other hand, are paid or received per unit or product, e.g., excise tax, service tax, export and import duties etc. …” |