0
Governments impose indirect taxes to...
· To raise government revenue - to effectively raise revenue, indirect taxes can be imposed upon price inelastic products so that demand does not fall and thus revenue is gained without impacting firms.
· To discourage consumption - higher prices will discourage some spending on all products with a PED value of more than 1.
· To alter the pattern of consumption - certain goods can be made more price attractive through lower taxes while goods which have high marginal social cost can be made expensive through taxation; e.g. increasing fuel taxes on airlines to better reflect the damage they cause.
What else can I help you with?
What happens on equilibrium price when the government impose tax on goods?
if there is equilibrium in the market and the govt. fixes the price then there would be the dead weight loss.
What is an indirect tax that is calculated per item?
Excise tax a+
How do you calculate net indirect tax with GDP and gnp?
Net indirect tax can be calculated using the formula: Net Indirect Tax = GDP - GNP + Subsidies - Transfer Payments. Here, GDP represents the total economic output within a country, while GNP accounts for the total income earned by residents, including income from abroad. The difference between GDP and GNP reflects net income from abroad, and adjustments for subsidies and transfer payments help refine the calculation. This formula provides a clearer picture of the government's revenue from indirect taxes after accounting for these factors.
What is an example of the government playing an indirect role in the economy?
An example of the government playing an indirect role in the economy is through the establishment of regulations and standards. For instance, the government may set environmental regulations that require companies to limit emissions, which can influence business practices and production costs. Additionally, by providing incentives such as tax breaks for renewable energy initiatives, the government can encourage investment in certain sectors without directly controlling those industries. This shape of indirect involvement can drive economic growth while promoting social goals.
The government might enact a price ceiling in order to accomplish what?
The government may impose a price ceiling in order to increase supply.
Is the tax on food items a direct or indirect tax?
Indirect tax because they are impose on goods and services
What is Direct and indirect tax?
A direct tax is a tax that is paid directly to the government by the person who is working. An indirect tax is when a person pays taxes to a store and then the store has to pay the taxes to the government.
Can the president impose excise tax?
No, the President of the USA does not have the Constitutional power to impose any tax. That is a power of the legislative branch of the government.
Is federal income tax direct or indirect?
Federal income tax is a direct tax on income and not an indirect tax. Direct taxes are paid directly to the government.
Which type tax is collected by the mediating agent and then forward to the government?
indirect tax
Is gasoline tax a direct tax?
No, any tax paid to a retail store or gas station is called an indirect tax. It is an indirect tax because you pay the tax to the store and they have to pay the tax to the government.
What do you mean by direct tax and indirect tax give suitable examples also?
A direct tax is tax paid directly to the Government, by a person whom the tax is imposed on. An indirect tax is paid indirectly to the Government, trough a third party.A direct tax would be taxes like income taxes, where a person must personally pay a certain amount to the government. Indirect taxes are taxes such as property, social security, and sales tax, where there price of tax is either deducted from wages or added onto the payment of an item. The indirect taxes are paid the Government by the business that collects the tax.
For what purpose may congress impose a tax?
One of the purposes that may make the congress to impose a tax is to increase the revenue of the government. When the revenue is increased, the federal government is able to provide the basic services to its citizens.
What is an example of indirect tax?
An example of an indirect tax is the sales tax, which is levied on the sale of goods and services. This tax is collected by retailers at the point of sale and then passed on to the government. Unlike direct taxes, such as income tax, the burden of indirect taxes can be shifted from the seller to the consumer, who pays the tax as part of the purchase price.
What is a example of indirect tax?
An example of an indirect tax is a sales tax, which is levied on the sale of goods and services. This tax is not directly paid by the individual to the government; instead, it is collected by retailers at the point of sale and then remitted to the government. Consumers ultimately bear the cost of the tax as it is typically included in the purchase price. Other examples of indirect taxes include value-added tax (VAT) and excise duties.
What is direct and direct tax?
A direct tax is a tax that is paid directly to the government by the person who is working. An indirect tax is when a person pays taxes to a store and then the store has to pay the taxes to the government.
Which statement is true of federal taxes?
the government may not impose a tax on church services.
