|Under the census of income method followed for the calculation of GDP, which factors would be counted?|
|3. Sales Tax|
|Choose the correct one:|
A) Only 1 and 2
B) Only 2 and 3
C) Only 1 and 3
D) All 1, 2 and 3
Correct Answer: D
Solution :Some economists challenge the notion of including sales taxes in the GDP formula on the basis that taxation is counterproductive. They think it should subtract from total output rather than add to it. However, most use the income approach that includes sales taxes. In India GDP did not include what that the Government received. Now, what that it earns by way of indirect taxes such as sales tax and excise duty after deducting subsidy is also added into the GDP.
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