With reference to GST, which of the following statements are true?
1. GST is based on a system of concurrency of indirect taxes
2. GST replaced a production-based taxation system by a consumption-based tax system
3. It brings destination principle for cross-border trading for which poorer states benefit at the expense of more affluent ones

Question

Question

This question was previously asked in

OPSC OAS 2023 Prelims (General Studies) Official Paper-I

Answer 1

The Correct answer is Option 4.

Key Points

GST is based on a system of concurrency of indirect taxes (1): This statement is true. Goods and Services Tax (GST) is implemented in a concurrent manner, meaning both the central and state governments can levy GST on the same goods and services.
GST replaced a production-based taxation system by a consumption-based tax system (2): This statement is true. GST shifted the focus from production-based taxation to consumption-based taxation, where taxes are levied on goods and services at the point of consumption.
It brings destination principle for cross-border trading for which poorer states benefit at the expense of more affluent ones (3): This statement is true. GST operates on the destination principle, meaning that the revenue from GST is collected in the state where the goods or services are consumed, allowing poorer states to benefit from the consumption activities occurring within their territories.
All the statements regarding GST are true. Thus, the correct answer is Option 4