721 RAS Prelims practice MCQs on the economy of Rajasthan are on this page, in 11 chapters. They cover the macro overview and State budget, agriculture, industry, the service sector, energy and transport infrastructure, rural development and Panchayati Raj, the State Finance Commission, education, health and the major welfare schemes. Each question has an answer and an explanation.
Practice questions based on the RPSC RAS Prelims syllabus. They follow the exam pattern but are not past-paper questions.
Showing 31–40 of 721 questions
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RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q31. Read the following statements concerning State Excise duty in Rajasthan: I. It is levied on alcoholic liquors for human consumption. II. It is also levied on opium, Indian hemp, and other narcotic drugs. III. It constitutes a negligible portion of the State’s Own Tax Revenue. Which of the above statement(s) is/are correct?
Explanation
State excise duty in Rajasthan is levied on alcoholic liquors for human consumption and on opium, Indian hemp and other narcotic drugs, so I and II are correct. It is a significant source of State Own Tax Revenue, so III is wrong.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q32. Match the specific tax (List I) with its corresponding tax base or characteristic in Rajasthan (List II):
Tax Type
Tax Base/Characteristic
A. Stamp Duty
i. Levied on the intra-state supply of goods and services
B. State Excise
ii. Levied historically on agricultural land holdings
C. SGST
iii. Levied on the execution of property transfer instruments
D. Land Revenue
iv. Levied on the manufacture and sale of liquor
Explanation
Stamp duty is specifically levied on the execution of legal property transfer instruments, while state excise is charged on the manufacture and sale of liquor. The State Goods and Services Tax applies to the intra-state supply of most goods and services. Historically, land revenue was based on agricultural land holdings, representing one of the oldest forms of taxation in the state.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q33. With the implementation of the Goods and Services Tax (GST), which of the following state taxes was subsumed into the GST framework?
Explanation
With the nationwide implementation of the Goods and Services Tax, various state-level taxes were subsumed into the new unified framework. In Rajasthan, this included the entertainment tax, except for those portions specifically levied by local bodies. However, taxes on alcohol for human consumption and petroleum products were kept out of GST, allowing the state to continue collecting excise and VAT.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q34. Which of the following statements regarding the impact of GST implementation on Rajasthan’s revenues is incorrect?
Explanation
While GST has expanded the tax base and eliminated cascading effects, individual states like Rajasthan do not possess the unilateral power to alter GST rates. All decisions regarding rate changes and exemptions are made collectively by the GST Council. This cooperative federalism structure ensures national uniformity but limits the state’s independent authority to adjust these specific tax rates for fiscal purposes.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q35. Read the following statements regarding GST revenues in Rajasthan: I. SGST revenues are directly credited to the Consolidated Fund of the State. II. Rajasthan receives a portion of the Integrated GST (IGST) collected on inter-state trade. III. The GST Council is chaired by the Finance Minister of Rajasthan on a rotational basis. IV. GST implementation has fully insulated the state from national economic slowdowns. Which of the above statement(s) is/are incorrect?
Explanation
State Goods and Services Tax revenues are credited to the state’s fund, and Rajasthan also receives a share of the Integrated GST from inter-state trade. However, the GST Council is chaired by the Union Finance Minister, not a state minister. Furthermore, GST implementation has not fully insulated the state from broader economic slowdowns, as tax collections remain linked to consumption.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q36. Which of the following pairs of ‘Tax’ and ‘Its Current Status under GST in Rajasthan’ is correctly matched?
Explanation
Entry tax was a state-level levy on the movement of goods into the state, and it was successfully subsumed into the Goods and Services Tax framework. In contrast, electricity duty and taxes on aviation turbine fuel remain outside GST in many states. Basic customs duty is a federal tax and was never part of the state-level taxes replaced by the GST system.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q37. Which Article of the Indian Constitution mandates the distribution of net proceeds of Central taxes between the Union and the States, a crucial source of revenue for Rajasthan?
Explanation
Article 270 of the Indian Constitution is the legal foundation for the sharing of net proceeds of most central taxes between the Union and the states. This mandatory devolution ensures that states like Rajasthan receive a predictable share of national revenue. These funds are crucial for financing state-specific development projects and maintaining essential public services across the expansive geographic territory of the state.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q38. The 15th Finance Commission used several criteria for the horizontal devolution of central taxes among states. Which criteria structurally benefits a geographically large state like Rajasthan the most?
Explanation
The 15th Finance Commission used several criteria for distributing central taxes, with the "Area" criterion proving highly beneficial for a geographically large state like Rajasthan. Because Rajasthan is the largest state in India by land area, it receives a higher weightage in the horizontal devolution formula. This allocation helps compensate for the higher costs associated with providing public services across sparsely populated regions.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q39. Which of the following was NOT a criterion used by the 15th Finance Commission for horizontal devolution of taxes?
Explanation
The 15th Finance Commission utilized specific criteria like area, forest and ecology, and demographic performance to determine the horizontal distribution of taxes among states. "Infrastructure Distance" was not among the criteria used by the commission.
RAS PrelimsRajasthan Economy · Macro Overview of Rajasthan Economy and State Budget
Q40. Read the following statements regarding Central transfers to Rajasthan: I. Tax devolution is a statutory right of the state based on Finance Commission formulas. II. Grants-in-aid under Article 275 are discretionary and not based on Finance Commission recommendations. III. Centrally Sponsored Schemes (CSS) form a significant part of central transfers to the state. IV. Rajasthan’s percentage share in the central divisible pool increased continuously from the 11th to the 15th Finance Commission without any dip. V. The State matching share is mandatory for most Centrally Sponsored Schemes. Which of the above statement(s) is/are correct?
Explanation
Tax devolution is a statutory right for Rajasthan, determined by Finance Commission formulas. Centrally Sponsored Schemes also form a significant portion of central transfers and usually require a mandatory matching share from the state budget. While grants under Article 275 are statutory, it is incorrect to say the state’s share in the central pool has increased continuously without any fluctuations.
Answer key for these questions
Q
Correct answer
31
(a) I and II
32
(a) A-iii, B-iv, C-i, D-ii
33
(d) Entertainment tax (excluding local body levies)
34
(b) Unilateral state power to alter GST rates
35
(b) III and IV
36
(a) Entry Tax -- Subsumed in GST
37
(c) Article 270
38
(d) Area
39
(c) Infrastructure Distance
40
(b) I, III and V
Key facts from Rajasthan Economy
The RPSC syllabus lists the economy of Rajasthan as the second part of the Economy paper.
Many questions ask for a Rajasthan-specific fact: a scheme, a year, a district or an institution.
The State budget chapter tests terms such as revenue deficit and fiscal deficit through the FRBM Act and the State’s debt.
Infrastructure chapters cover solar and wind energy, DISCOM finances, highways, the DMIC and the Jaipur Metro.
The national economy chapters are on the Indian Economy page.
Frequently asked questions
How many RAS Prelims practice MCQs are there on Rajasthan Economy?
This page has 721 practice MCQs on Rajasthan Economy. Each has the correct answer, and most have an explanation.
Which chapters does the Rajasthan economy set cover?
Eleven chapters: macro overview and State budget; agriculture; industry; the service sector; energy infrastructure; transportation and communication; rural development and Panchayati Raj; State Finance Commission and fiscal devolution; education; health; and the major welfare schemes of the Rajasthan Government.
Is the Rajasthan economy in the RAS Prelims syllabus?
Yes. RPSC lists the economy of Rajasthan as the second part of the Economy paper, after economic concepts and the Indian economy, so both parts are examined in the same paper.
How can I prepare the Rajasthan economy chapters?
Keep a list of schemes with their year, objective and target group, and a list of district-wise crops and industries. Attempt each chapter, read the explanation of every miss and revise the list a few days later.
