The concept of tax sufficiency:
A) Suggests the need for tax forecasting.
B) Suggests that a government should estimate how taxpayers will respond to changes in the current tax structure.
C) Suggests that a government should consider the income and substitution effects when changing tax rates.
D) All of the choices are correct.
E) None of the choices are correct.

Question

Quizplus · Accepted Answer

The concept of tax sufficiency suggests that a government should estimate how taxpayers will respond to changes in the current tax structure, consider the income and substitution effects when changing tax rates, and therefore requires tax forecasting. Therefore, all the choices are correct.

The Concept of Tax Sufficiency