Question

The Central Government derives maximum revenue from ----
A. Income tax
B. Excise duties
C. Customs
D. None of these

Answer 1

Hint: When the Goods and Services Tax (GST) was introduced by the ruling government in the year of 2017 it completely changed the way we should pay our taxes. The Central Government derives maximum revenue from an indirect tax.

Complete answer:
Incomes that are earned by people and corporate entities, those are to be levied by direct taxes. While indirect taxes are levied when goods and services are sold and the responsibility of collecting and submitting the tax is the individual who sold the product or service not the government. In India both Central and State governments levy taxes. Sometimes taxes are even levied by local governing bodies such as municipalities.
Excise taxes alludes to the expenses collected on the production of merchandise inside the nation, instead of custom obligation that is required on merchandise coming from outside the nation. Excise duty is a type of aberrant assessment which is commonly gathered by a retailer or a middle person from its customers and afterward paid to the public authority. Despite the fact that this obligation is payable on assembling merchandise, it is generally payable when the products are 'eliminated' from the spot of creation or from the stockroom with the end goal of offer. There is no necessity for the real sale of the products for imposing the excise duty since it is imposed on the manufacture of such products. The Central Board of Excise and Customs (CBEC) is responsible for collecting Excise duties.

Hence, the correct answer is option (B).

Note:There are a total of eleven different types of excise duties. The are Basic Excise Duty, Special Excise Duty, Education Cess on Excise Duty, Natural Calamity Contingent Duty, Excise Duty in case of clearances by Export Oriented Units, Duties under other Acts, Additional Duty on Goods of Special Importance, Additional Customs Duty commonly known as Countervailing Duty (CVD), Additional Duty on Mineral Products, Duty on Medical and Toilet Preparations and Special Additional Duty of Customs.