Q. Consider the following statements:
1.Corporate tax is a type of indirect tax.
2.Global Minimum Corporate Tax (GMCT) is the minimum amount of corporate tax a company must pay on its income, both domestic and foreign.
3.The Base Erosion and Profit Shifting (BEPS) initiative seeks to grant tax rebates to businesses that adhere to sound and transparent tax practices.
Which of the statements given above is/are correct?
Answer: C
Notes:
Explanation –
Statement 1 and 3 are incorrect. Corporation Tax or Corporate Tax is a direct tax levied on the net income or profit of a corporate entity from their business. BEPS aims to curb practices that allowed companies to reduce their tax liabilities by exploiting loopholes in the tax law.
Statement 2 is correct. GMCT is the minimum amount of corporate tax a company must pay on its income, both domestic and foreign.
Source: ForumIAS
