testing whether the testee understands their nation, its values, and the democratic principles it is founded on

It seems like you only want people with certain "values" to be able to vote. What even are a nation's "values" anyway? Most of the time I hear that it's just vague nationalist propaganda about how our nation and our people are wonderful. I will admit that's a bit of a specific nitpick though.

As for "the structure of government and the content of the constitution", I honestly don't think the details of how laws are passed or how many seats are in congress, etc, matter much when it comes to deciding which policies you support and which party you'll vote for.

By their very nature, laws like this exclude people who are less educated and have less free time and/or motivation to study for your test. These are almost always going to be also the most disadvantaged and poorly treated people in society.