True or false a license can be a form of a tax?

Answer 1

I guess it could be considered a form of tax. The money you pay for the registration and personalized plates goes to the DMV and is used to help organizations like the highway patrol and local police forces.

Added: No. A license is issued by the state or local government to an individual or a corporation for the specific purpose of being authorized to engage in a specific type of employment, vocation, or activity. It is a FEE to (allegedly) reimburse the government for the overseeing and ongoing supervision of that occupation, and EVERYBODY pays the same fee regardless of whether that person (or business) earns millions of dollars a year, or earns nothing at all,

Whereas a TAX is based on the income that that individual or occupation generates, usually calculated on a pro-rata percentage basis.

Yes, in most all academic presentations licence's, like tariffs or other fees, are indeed analogous and used as a form of tax.

Licenses come in many types (not just driving) - like fishing or hunting, permits to use things, or operate things (like equipment), or perform a service (a barber, a physician, etc). The comment about licences being the same is incorrect. They may vary, even within a type, by many things: say the weight or number of wheels on a vehicle, how long it is for (a business licence for a weekend or season compared to a year), what it allows you to do (fish here, but no there), age discounts, reduced fees for prior experience or other standards being met, etc., etc., etc.

Most importantly, read any government budget and you will note that fee's from licenses are like any other tax revenue (some, but not all earmarked for a specific purpose, but the raising of fees used as a mechanism to balance budgets.