Consider the following:

  1. Implementation of 7th Pay Commission
  2. Increase in Dividend distribution Tax
  3. Increase in number of Central Sector Schemes
  4. Disinvestment of government holdings

Which of the above will help the government to reduce its fiscal deficit?

Answer: [B] Only 2 & 4

Implementation of 7th Pay Commission and Increase in Central Sector Schemes will increase revenue expenditure of the government and hence will increase fiscal deficit.

This question is a part of GKToday's Integrated IAS General Studies Module