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Explanation:

(b) is the only option that explains how reducing
taxes will broaden the tax base. If taxes on cigarettes (which constitute 90% of the revenues) are reduced, the prices of cigarettes will come down, thereby increasing the demand for cigarettes. More the cigarette smokers, the broader the tax base. Options (a) and (c) mention peripheral matters. (d) is talking about increasing duties (taxes) whereas the last sentence of the paragraph has only looked at “reducing taxes”.

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