Which of the following reduces income inequality?

CA Foundation · Business Economics · MTP · September 2025
Which of the following reduces income inequality?
(A) A. Flat tax system
(B) B. Public expenditure on luxury goods
(C) C. Progressive taxation and targeted subsidies
(D) D. Tax holidays for MNCs

Suggested Answer and Working Notes:

Correct Answer: Option (C)

C. Progressive taxation and targeted subsidies

Topics: Public Finance

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