1
According to Adam Smith, what are the four canons of taxation?
Equality, Certainty, Convenience, and Economy.
Tax Theory
- 20 soru-cevap
- Publıc Fınance (ENG)
2
What are the three main categories of taxes?
Income taxes, consumption taxes, and wealth taxes.
3
What principle argues that people should pay taxes according to the benefits they receive?
The Benefit Principle.
4
What does the “ability to pay” principle suggest?
Individuals should pay taxes based on their income or wealth, regardless of benefit received.
5
What is the difference between a direct and an indirect tax?
Direct taxes are paid directly to the government by the taxpayer; indirect taxes are collected by intermediaries (e.g., sellers).
6
What makes consumption taxes regressive?
They take a larger percentage of income from lower-income individuals.
7
What kind of tax is collected per unit of a good?
Specific tax.
8
What is a progressive tax system?
A system where the tax rate increases as income increases.
9
What is the main objective of tax expenditures?
To reduce tax burden and promote fairness or desired activities.
10
What is the formula for the tax multiplier?
[-MPC ÷ (1 – MPC)]
11
What is tax incidence?
It refers to how the burden of a tax is distributed between buyers and sellers.
12
Who bears the tax burden when demand is perfectly elastic?
The seller.
13
What are the three components of tax burden?
Administrative costs, compliance costs, and deadweight loss.
14
What is deadweight loss?
The economic inefficiency resulting from a tax.
15
How does demand elasticity affect deadweight loss?
More elastic demand leads to greater deadweight loss.
16
What is Ramsey taxation?
A taxation strategy that minimizes economic distortion by taxing inelastic goods more.
17
What is a Pigovian tax?
A tax imposed to correct negative externalities.
18
What is tax evasion?
Illegally avoiding taxes through fraudulent means.
19
What is tax avoidance?
Legally minimizing tax liability using loopholes or incentives.
20
What psychological factor can influence tax evasion?
Social norms and peer influence (reference groups).