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GATE 2020 CS – Question 6

General Aptitude · Verbal Aptitude: Reading Comprehension and Reasoning · 2 marks · Multiple choice

Goods and Services Tax (GST) is an indirect tax introduced in India in 2017 that is imposed on the supply of goods and services, and it subsumes all indirect taxes except few. It is a destination-based tax imposed on goods and services used, and it is not imposed at the point of origin from where goods come. GST also has a few components specific to state governments, central government and Union Territories (UTs).

Which one of the following statements can be inferred from the given passage?

  1. GST is imposed on the production of goods and services.
  2. GST includes all indirect taxes.
  3. GST does not have a component specific to UT.
  4. GST is imposed at the point of usage of goods and services.

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Correct answer: (D) GST is imposed at the point of usage of goods and services.

Explanation

GST is destination-based, i.e. imposed where goods and services are used. The other options contradict the passage.