Tax incidence analysis seeks to determine:

Question

Quizplus · Accepted Answer

Tax incidence analysis seeks to determine who actually bears the burden of a tax, which could be the consumer, the producer, or shared between the two. Option A discusses who physically sends the tax payment to the government, which is not the same as the tax burden. Option C tries to identify who ultimately benefits from tax revenue, whereas the tax incidence looks at who bears the burden. Option D looks at the nature of the tax system, which could be based on benefits received or ability to pay, but does not consider who ultimately bears the burden of the tax.

Tax Incidence Analysis Seeks to Determine