India is suffering from the problem of inequalities in the distribution of income and wealth. How can a budget be used as an instrument?
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A budget can be used as an instrument to reduce the inequalities in the distribution of income and wealth in the following ways:
- Tax rates should be made progressive, i.e. rate of tax should increase with increase in income.
- Strict measures should be adopted to check tax evasion by the rich people.
- Subsidies should be provided wherever needed.
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