Question

Explain the ‘redistribution of income’ objective of the Government Budget.

Hint:

The government budget helps in reducing income inequality by taxing the rich and providing subsidies and welfare schemes for the poor.

Answer 1

The government budget aims to reduce income inequalities by redistributing wealth from the rich to the poor. This is achieved through progressive taxation policies, where higher income groups are taxed more and lower-income groups receive subsidies and welfare programs. Public expenditure on education, healthcare, and social welfare helps to provide equal opportunities and improve living standards for the underprivileged.