Exam 17: Taxation and Resource Allocation

Which of the following would be the most likely candidate for direct application of the benefits principle of taxation?

In England, the Thatcher government substituted a "poll tax" for the local property tax.People took strong exception to the tax, which is basically a head or "lump sum" tax.The principle of taxation such a tax violates is called

The allocation of tax burden

Taxes on sales of liquor, tobacco, and tires are examples of

An excise tax is

The second largest source of revenue for the federal government is the

Figure 18-1 -According to the graph in Figure 18-1, the increase in the amount that consumers pay as a result of the tax is

The courts in some states have declared the financing of public schools by local property taxes unconstitutional because

Describe the U.S.Social Security system and explain how it is funded.

State and local governments receive money from sales taxes, property taxes, and the federal government.

If the supply of a good is perfectly inelastic, then suppliers will bear the full burden of an excise tax

How is state and local government funded and how does such funding differ from federal government funding?

Fiscal federalism refers to

A payroll tax with a 4.5 percent tax rate and exemption for income above $42,000 is

The average tax rate is

Horizontal equity means that equally situated individuals should be taxed equally.

State personal income taxes are

The federal government receives most of its revenue from three sources: personal income tax, corporate income tax, and payroll tax.

A tax that reduces economic efficiency is always bad policy.

The notion that equally situated individuals should be taxed equally is referred to as