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Section 1. What are Taxes Questions and Answers Fully Solved
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Section 1. What are Taxes
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Section 1. What are TaxesWhat gives the Gov the power to collect taxes? - answer Framers of the Constitution
that give the gov certain powers.
4 ways in which the gov's power to tax is limited: - answer1. Common defense and
general welfare
2. federal taxes must be the same in every state.
3. gov cant tax exports
4. cant tax church based off the 1st amendment
List and define 3 types of tax structures: - answer1. Proportional Taxes- Percentage of
income paid in taxes remains the same for all income levels
2. Progressive Taxes- percent of income paid in taxes increase as income increases
3. Regressive Taxes- percentage of income paid in taxes decreases as income
increases
List and define the characteristics of a good tax: - answer1. Simplicity- simple and easy
understood
2. Efficiency- gov administrators should be able to collect taxes without spending much
time or money.
3. Certainty- Should be clear to taxpayer when tax and money is due, and how to pay
for it
4. Equity- Tax system should be fair, so that no one bears too much or too little of the
tax burden.
The income, property, good, or service that is subject to tax is considered a
____________. - answertax base
The __________ is the final burden of a tax. - answerincidence of tax
Sales tax is a type of ______ tax. - answerRegressive
With a _______________ the percentage of income paid in taxes remains the same for
all income levels. - answerproportional tax
Income tax is a type of_____ tax. - answerprogressive
The income the gov receives is called ________. - answerrevenue
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