Academic Integrity: tutoring, explanations, and feedback — we don’t complete graded work or submit on a student’s behalf.

Which tax is paid by consumers to vendors at the point of sale? sales tax proper

ID: 1116853 • Letter: W

Question

Which tax is paid by consumers to vendors at the point of sale?

sales tax

property tax

wealth tax

excise tax

Which of the following is equal to government revenue losses attributable to tax law provisions that allow special exclusions, exemptions, or deductions from gross income or that provide a special credit, preferential tax rate, or deferral of liability?

tax deductions

tax expenditures

tax credits

withholding

Which statement about the subsidy for home ownership is TRUE?

The rationale behind the subsidy is that homeowners donate more to charitable causes.

Empirical research suggests that the tax subsidy does not change homeownership rates but rather induces homeowners to spend more on houses.

The rationale behind the subsidy is that there is a positive externality associated with people buying larger, more expensive houses.

Empirical research suggests that the home mortgage interest deduction is justified by large positive externalities associated with homeownership.

Which item was the largest tax expenditure of the federal government in 2014?

exclusion of pension contributions and earnings, including 401(k) plans

deductibility of state and local taxes

exclusion of employer contributions for medical insurance from taxable income

deductibility of home mortgage interest

Which tax is paid by consumers to vendors at the point of sale?

sales tax

property tax

wealth tax

excise tax

Which of the following is equal to government revenue losses attributable to tax law provisions that allow special exclusions, exemptions, or deductions from gross income or that provide a special credit, preferential tax rate, or deferral of liability?

tax deductions

tax expenditures

tax credits

withholding

Which statement about the subsidy for home ownership is TRUE?

The rationale behind the subsidy is that homeowners donate more to charitable causes.

Empirical research suggests that the tax subsidy does not change homeownership rates but rather induces homeowners to spend more on houses.

The rationale behind the subsidy is that there is a positive externality associated with people buying larger, more expensive houses.

Empirical research suggests that the home mortgage interest deduction is justified by large positive externalities associated with homeownership.

Which item was the largest tax expenditure of the federal government in 2014?

exclusion of pension contributions and earnings, including 401(k) plans

deductibility of state and local taxes

exclusion of employer contributions for medical insurance from taxable income

deductibility of home mortgage interest

Explanation / Answer

Ans:

1) sales tax

A sales tax is a indirect tax imposed by the government on the sale of goods and services. A sales tax is levied at the point of sale which is pais to the vendor and who passes on to the government.

2) tax expenditures

Tax expenditure is the revenue losses resulting from the provisions of the Federal tax laws which allow a special exclusion, exemption, or deduction from gross income.

3) Empirical research suggests that the home mortgage interest deduction is justified by large positive externalities associated with homeownership.

This will motivate the people to own a home and have a positive effect on increasing the standard of living of the people.

4) exclusion of employer contributions for medical insurance from taxable income

The largest tax expenditure to the government is from exclusion of employer contributions for medical insurance from taxable income.