The following graph indicates the composition of our tax revenue for a period of two decades : ![76](https://d39jluplm5thpx.cloudfront.net//CSAT_2018_Q76_94d2b4adec.png) With reference to the above graph, which of the following is/are the most logical and rational inference/ inferences that can be made? 1. During the given beriod, the revenue from Direct Taxes as percentage of gross tax revenue has increased while that of Indirect Taxes decreased. 2. The trend in the revenue from Excise Duty demonstrates that the growth of manufacturing sector has been negative during the given period. Select the correct answer using the code given below.

Question

CSATMediumPrelims 2018Reasoning

The following graph indicates the composition of our tax revenue for a period of two decades :

With reference to the above graph, which of the following is/are the most logical and rational inference/ inferences that can be made?

During the given beriod, the revenue from Direct Taxes as percentage of gross tax revenue has increased while that of Indirect Taxes decreased.
The trend in the revenue from Excise Duty demonstrates that the growth of manufacturing sector has been negative during the given period.

Select the correct answer using the code given below.

Explanation

Statement 1: Correct, as the graph shows Direct Taxes increasing and Indirect Taxes decreasing as a percentage of gross tax revenue.

Statement 2: Incorrect, because a decline in Excise Duty revenue does not necessarily imply negative manufacturing growth; other factors like tax policies could influence it.