Q1 | 16th Finance Commission (Current Affairs — HIGH PROBABILITY)

With reference to the 16th Finance Commission, consider the following statements:

1. It has recommended 41% of the net proceeds of Union taxes to be shared with the States.
2. It has discontinued revenue deficit grants, sector-specific grants, and state-specific grants.
3. It has introduced "Contribution to GDP" as a new criterion for horizontal devolution.

Which of the statements given above is/are correct? (a) 1 and 2 only      (b) 1 and 3 only      (c) 2 and 3 only      (d) 1, 2 and 3

Q2 | GST 2.0 Reforms (Current Affairs — HIGH PROBABILITY)

With reference to the Next-Gen GST reform (GST 2.0) approved by the GST Council in September 2025, consider the following statements:

1. The number of GST rate slabs has been reduced from four to two standard slabs plus an exempt and a luxury/sin slab.
2. Health insurance and life insurance have been brought under the 5% merit rate slab.
3. A new 40% slab has been introduced for luxury goods and sin goods.

Which of the statements given above is/are correct? (a) 1 and 3 only      (b) 2 and 3 only      (c) 1 only      (d) 1, 2 and 3

Q3 | Deficit Calculation (Application-Based — Repeated Theme)

Consider the following data for a hypothetical economy:

What are the Revenue Deficit and Fiscal Deficit respectively? (a) ₹6 lakh crore and ₹17 lakh crore (b) ₹6 lakh crore and ₹7 lakh crore (c) ₹16 lakh crore and ₹17 lakh crore (d) ₹6 lakh crore and ₹27 lakh crore

Q4 | Revenue vs Capital Receipts (Conceptual)

Consider the following:

1. Interest received on loans given to State Governments
2. Disinvestment proceeds from sale of government equity in PSUs
3. Grants received from a foreign government
4. Recovery of loans previously given

Which of the above are "Revenue Receipts" of the Government? (a) 1 and 3 only      (b) 2 and 4 only      (c) 1, 3 and 4      (d) 1, 2, 3 and 4

Q5 | Income Tax Act 2025 (Current Affairs)

With reference to the Income Tax Act, 2025, consider the following statements:

1. It replaces the concept of "Previous Year" and "Assessment Year" with a unified "Tax Year".
2. It formally defines "Virtual Digital Assets" to cover cryptocurrency and related digital assets.
3. It has been effective from April 1, 2025.

Which of the statements given above is/are correct? (a) 1 and 2 only      (b) 2 and 3 only      (c) 1 only      (d) 1, 2 and 3

Q6 | Zero-rated vs Nil-rated vs Exempt (Conceptual)

Under the Goods and Services Tax framework, consider the following:

Which of the pairs given above is/are correctly matched? (a) 1 and 2 only      (b) 2 and 3 only      (c) 1 only      (d) 1, 2 and 3

Q7 | GSTAT (Current Affairs)

With reference to the GST Appellate Tribunal (GSTAT) launched in September 2025, consider the following statements:

1. It is a statutory appellate body established under the CGST Act, 2017.
2. It functions as the first forum of appeal for taxpayers against GST Adjudicating Authority decisions.
3. The Principal Bench is located in New Delhi and there are 31 State Benches across the country.

Which of the statements given above is/are correct? (a) 1 and 3 only      (b) 1 and 2 only      (c) 2 and 3 only      (d) 1, 2 and 3

Q8 | Cess and Surcharge (Repeated Theme)

With reference to cess and surcharge levied by the Central Government, consider the following statements:

1. Cess and surcharge are part of the divisible pool of taxes shared with States.
2. The increasing reliance on cess and surcharge effectively reduces the quantum of devolution to States.
3. GST Compensation Cess was introduced to compensate States for revenue loss during the first five years of GST implementation.

Which of the statements given above is/are correct? (a) 1 and 3 only      (b) 2 and 3 only      (c) 1 and 2 only      (d) 1, 2 and 3

Q9 | Tax Avoidance — BEPS (Current)

Consider the following:

1. Base Erosion and Profit Shifting (BEPS) refers to MNCs artificially shifting profits from high-tax to low-tax countries.
2. The "Arm's Length Principle" means that the price between related entities must match what unrelated parties would charge.
3. India's Equalization Levy is a provision under the Income Tax Act, 1961.

How many of the above statements are correct? (a) Only one      (b) Only two      (c) All three      (d) None

Q10 | FRBM Act — NK Singh Committee (Repeated)

With reference to the Fiscal Responsibility and Budget Management (FRBM) Act, 2003, consider the following statements:

1. The NK Singh Committee recommended shifting the primary fiscal anchor from fiscal deficit to debt-to-GDP ratio.
2. The Act mandates the government to lay a Medium Term Fiscal Policy Statement before Parliament along with the Budget.
3. The 3% fiscal deficit target under the FRBM Act has been consistently achieved since 2003.

Which of the statements given above is/are correct? (a) 1 and 2 only      (b) 1 and 3 only      (c) 2 and 3 only      (d) 1, 2 and 3

Q11 | Poultry Farming — Agricultural Income (2025 Follow-up)

With reference to the Income Tax Act, consider the following statements: Statement-I: Income from poultry farming is exempt from income tax as agricultural income. Statement-II: Rural agricultural land in India is not considered a capital asset under the Income Tax Act.

Which one of the following is correct in respect of the above statements? (a) Both Statement-I and Statement-II are correct and Statement-II is the correct explanation for Statement-I (b) Both Statement-I and Statement-II are correct but Statement-II is NOT the correct explanation for Statement-I (c) Statement-I is correct but Statement-II is incorrect (d) Statement-I is incorrect but Statement-II is correct