Q15 VERBAL LOGIC
Cigarettes constitute a mere 20% of tobacco consumption in India,
and fewer than 15% of the 200 million tobacco users consume cigarettes. Yet
these 15% contribute nearly 90% of the tax revenues to the Exchequer from the
tobacco sector. The punitive cigarette taxation regime has kept the tax base
narrow and reducing taxes will expand this base. Which one of the following
best bolsters the conclusion that reducing duties will expand the tax base?The correct option is B
There is a likelihood that tobacco consumers will shift to cigarette smoking, if cigarette prices were to reduce.
Write Here
Video Explanation
