Which of the Following Is Not a Reason That Tax

question 49

Multiple Choice

Which of the following is not a reason that tax revenue might fall at very high tax rates?

• A)People have a greater incentive to practice tax avoidance.
• B)Government officials fail to enforce tax laws.
• C)People tend to commit more tax evasion.
• D)People work less in the case of a personal income tax.
• E)Corporations inflate expenses in the case of a corporate income tax.

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Definitions:

Tax Burden

The total amount of taxes paid by individuals or businesses, relative to their income or profit.

Rental Housing

Dwelling units leased or rented to tenants under a contract or agreement, providing a place to live in exchange for payment.

Price Ceiling

A legal maximum price at which a good can be sold, often set by government to control prices.

Housing Shortage

A situation where the supply of available houses is not sufficient to meet the demand for them in a particular area.