Asked by Ishmail Mgwena on May 19, 2024
Verified
A 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 the same amount in taxes.
C) pay taxes based on consumption rather than income.
D) make an equal sacrifice.
Ability-To-Pay Principle
A taxation principle that suggests taxes should be levied according to an individual's or entity's capacity to pay, typically measured by income or wealth.
Taxes
Compulsory financial charges or some other type of levy imposed on a taxpayer by a governmental organization in order to fund government spending and various public expenditures.
Government Services
Various services provided by the government to citizens including education, healthcare, law enforcement, and public infrastructure.
- Elucidate on the principles of vertical and horizontal fairness in fiscal systems.
- Understand the core guidelines of tax policy, including the principles of paying according to one’s ability and receiving benefits in return.
Verified Answer
SF
Skull ForgerMay 23, 2024
Final Answer :
D
Explanation :
The ability-to-pay principle in taxation argues that taxes should be levied according to an individual's or entity's ability to pay. This typically means that those with higher incomes or more resources should pay more in taxes, reflecting the concept of making an "equal sacrifice" in terms of the burden of taxation.
Learning Objectives
- Elucidate on the principles of vertical and horizontal fairness in fiscal systems.
- Understand the core guidelines of tax policy, including the principles of paying according to one’s ability and receiving benefits in return.