A redistribution of income in a country can be best brought about through:
✓ Correct answer: a) progressive taxation combined with progressive expenditure
ExplanationRedistribution of income is best achieved through pro- gressive taxation, where higher-income groups are taxed at a higher rate, and progressive expenditure, where govern-ment spending is directed toward social welfare programs, such as education, healthcare, and poverty alleviation.This ensures eq- uitable resource distribution and addresses income inequality.Examples include India’s National Food Security Act and subsi- dies for essential services like health and education funded by a progressive tax structure.This combination promotes social eq- uity and economic stability.Options (b), (c), and (d) are incorrect:Regressive expenditure would widen income inequality by favoring higher-income groups.Regressive systems, in both taxation and expenditure, would exacerbate inequality.Regressive taxation would disproportionately burden the poor, even if expenditures are progressive.9. PUBLIC FINANCE 227
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