Tax incidence analysis seeks to determine:

Question

Quizplus · Accepted Answer

Tax incidence analysis aims to discover the actual burden of a tax, which is the degree to which it affects the price and quantity of goods and services in the market. It scrutinizes who ends up bearing the tax burden, whether it is the consumers, producers, or both. Hence, it analyzes the real impact of taxes, not only who sends the payment to the government. Option A is only a part of tax incidence analysis, but it does not provide the whole picture. Option C talks about where the tax revenue goes, which is not part of tax incidence analysis. Also, option D is not related to the topic of tax incidence analysis.

Tax Incidence Analysis Seeks to Determine