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Consider the following statements: 1. Tax revenue as a percent of GDP of India has steadily increased in the last decade. 2. Fiscal deficit as a percent of GDP of India has steadily increased in the last decade. Which of the statements given above is/are correct?

Consider the following statements: 1. Tax revenue as a percent of GDP of India has steadily increased in the last decade. 2. Fiscal deficit as a percent of GDP of India has steadily increased in the last decade. Which of the statements given above is/are correct? Correct Answer Neither 1 nor 2

The correct answer is Neither 1 nor 2.

Tax to GDP

  • Decade 2001-2011: Steady fall after sub-prime crisis (2007-2010) and then recovery.
  • Decade 2006-2016: Except for the fall in 2008 to 2010, there is steady growth. Hence statement 1 is incorrect.

​​Fiscal Deficit to GDP

  • Decade 2001-2011: Decline between 2009-11.
  • Decade 2006-2016: Steadily declining from 2011 to 2016. Hence statement 2 is also incorrect.

Related Questions

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