Q. Consider the following statements regarding Constitutional Provisions on Taxation:

1. The Parliament can reduce or abolish a tax.
2. The Parliament cannot increase the tax.
3. Central and state governments have concurrent power of taxation.
4. The government can levy and charge taxes on individuals and organizations without backing of a law.

Which of the above statements is/are correct?
Answer: Only 1 & 2
Notes: Levy and collection of taxes requires authority by law, as per Article 265. Parliament may reduce or abolish a tax, but powers to increase or introduce new taxes require legal backing. Central and state governments have defined, not concurrent, taxation powers in the Seventh Schedule. Government action must be backed by a law passed by the Parliament or state legislature.