Economics For Today
10th Edition
ISBN: 9781337613040
Author: Tucker
Publisher: Cengage Learning
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Question
Chapter 22, Problem 4SQP
(a)
To determine
The
(b)
To determine
The Federal income tax and the taxation principle.
(c)
To determine
The tax on the social security benefits and the taxation principle.
Expert Solution & Answer
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Students have asked these similar questions
A progressive tax is:
A. designed to take a greater percentage of the income of lower-income groups than of higher-income groups
B. based on the benefits received principle.
C. not based on the ability to pay principle
D. designed so that everybody would be charged the same percentage of their income as taxes.
E. designed to take a larger percentage of the income of higher-income groups than of lower-income groups
Horizontal equity in a taxation system is the idea that
Select one:
a.those who earn more should pay more tax.
b.everyone should pay the same amount of tax.
c.all taxpayers should be treated the same.
d.those who earn the same should pay the same tax.
Which of the following taxation systems does not conform to the idea of vertical equity?
Select one:
a.A flat tax where every dollar of income is taxed at 25 percent.
b.A progressive tax system.
c.GST.
d.A poll tax where every taxpayer pays an identical lump sum amount of $10,000 in tax.
Explain the benefits principle and the ability-to-pay principle. What are vertical eguity and horizontal eguity?. Why is studying tax incidence important for determining the eguity of a tax system?
Chapter 22 Solutions
Economics For Today
Ch. 22.4 - Prob. 1YTECh. 22 - Prob. 1SQPCh. 22 - Prob. 2SQPCh. 22 - Prob. 3SQPCh. 22 - Prob. 4SQPCh. 22 - Prob. 5SQPCh. 22 - Explain why a 5 percent sales tax on gasoline is...Ch. 22 - Prob. 7SQPCh. 22 - Prob. 8SQPCh. 22 - Prob. 9SQP
Ch. 22 - Prob. 10SQPCh. 22 - Prob. 11SQPCh. 22 - Prob. 1SQCh. 22 - Prob. 2SQCh. 22 - Prob. 3SQCh. 22 - Prob. 4SQCh. 22 - Prob. 5SQCh. 22 - Prob. 6SQCh. 22 - Prob. 7SQCh. 22 - Prob. 8SQCh. 22 - Prob. 9SQCh. 22 - Prob. 10SQCh. 22 - Prob. 11SQCh. 22 - Prob. 12SQCh. 22 - Prob. 13SQCh. 22 - Prob. 14SQCh. 22 - Prob. 15SQCh. 22 - Prob. 16SQCh. 22 - Prob. 17SQCh. 22 - Prob. 18SQCh. 22 - Prob. 19SQCh. 22 - Prob. 20SQ
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Similar questions
- The idea that an increase in a tax rate generates a reduction in the tax base that makes the net effect of the tax rate increase potentially ambiguous is called the: Select one: a. merit taxation perspective. b. external taxation perspective. c. dynamic view of taxation. d. static view of taxation.arrow_forwardA tax system based on the ability-to-pay principle claims that all citizens should A. pay taxes based on the benefits they receive from government services. B. pay taxes based on consumption rather than income. C. pay taxes based on saving rather than income. D. pay the same amount in taxes. E. make an equal sacrifice.arrow_forwardWhich of the following programs are often funded by the payroll tax? Check all that apply. A. social security programs B. unemployment benefits C. library services D. education servicesarrow_forward
- Contrast the benefits-received and ability-to-pay principles of taxation. Which of the following taxes mainly adhere to the benefits-received principle? Which mainly to the ability-to pay principle? The Federal and state gasoline tax.arrow_forwardOnce a government makes "sin taxes" a significant part of its revenue stream, it has an incentive to keep people smoking and drinking. If everyone quits smoking, the government does not get any cigarette tax revenue. Is it really a good idea to fund public services on the back of citizens' addictions? Give at least three reasons and discuss each clearly.arrow_forwardA proportional tax, sometimes referred to as a flat tax, is a kind of income tax wherein all taxpayers are taxed at the same percentage rate, no matter how high or low their income. A proportional tax system means that everyone experiences the same tax rate, whether low, middle, or high-income. Those who support a proportional tax argue that the system is fairest because the rules are simple and straightforward and no one is exempt; however, there is a huge con of proprtional taxes. Explain what that is. Essayarrow_forward
- Contrast the benefits-received and ability-to-pay principles of taxation. Which of the following taxes mainly adhere to the benefits-received principle? Which mainly to the ability-to pay principle? A toll charge required for driving on a public highway.arrow_forwardWhich principle states that taxes should be levied according to a taxpayer’s ability to pay?a) Benefit principleb) Horizontal equityc) Vertical equityd) Ability-to-pay principle. Note : don't use chat gpt.arrow_forwardWrite true or false for the following: a.The government modifies the taxation system sometimes to discourage spending so it can mop up over production in the economy. b.A progressive tax system increases income inequality. c. direct tax is said to be direct tax when the impact and incidence of a tax are on one and the same person. 2. Fill in the blanks with the correct terms ______is a tax where the _____ falls on one person and the _____arrow_forward
- According to the textbook, which of the following statements about taxes in the U.S. is (are) correct? (x) Tax evasion is illegal, but tax avoidance is legal. (y) Most economists believe that a corporate income tax affects the stockholders of a corporation but not its employees or customers. (z) In practice, the U.S. income tax system is filled with special provisions that alter a family's tax based on its specific circumstances. A. (x), (y) and (z) B. (x) and (y) only C. (x) and (z) only D. (y) and (z) only E. (z) onlyarrow_forwardWhich principle states that taxes should be levied according to a taxpayer’s ability to pay?a) Benefit principleb) Horizontal equityc) Vertical equityd) Ability-to-pay principlearrow_forwardThe benefits received principle of taxation asserts that Select one: a. Society at large should pay for the taxes b. The one who benefit most from public goods should pay the taxes c. Tax burden should be apportioned according to taxpayers’ income and wealth d. All the answers are correct e. None of the answers are correctarrow_forward
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