Official Answer Key & Detailed Solution
Ready to check the official UPSC Answer Key?
Click any option above to test yourself under exam conditions, or reveal the explanation directly.
Correct Answer: Option (B) — indirect tax levied by the Central Government.
Concept & Option Breakdown
Standard Reference VerifiedService tax was an indirect tax introduced by the Central Government under the Finance Act, 1994 (Entry 97/Entry 92C of the Union List). Its incidence was passed on from service providers to consumers. It was subsequently subsumed under the Goods and Services Tax (GST) regime in July 2017.
Taxes on services and goods (like customs, central excise, service tax) are classic indirect taxes, historically levied by the Union (Central) Government.
Practice Full-Length & Sectional Prelims Mocks on this Interface
50 simulated tests in the APT Prelims Test Series (₹1,493) or 1-on-1 Mentorship with Avinash Sir.