The difference between the loss of surplus to taxpayers and the tax revenue collected is called:

Question

Quizplus · Accepted Answer

Deadweight loss refers to the loss of economic efficiency when the equilibrium outcome is not achievable or not achieved. In the context of taxation, deadweight loss occurs because taxes distort the market equilibrium, leading to less trade and activity than would occur in a tax-free market. This results in a loss of surplus to both consumers (taxpayers) and producers that is not offset by the tax revenue collected by the government.

The Difference Between the Loss of Surplus to Taxpayers and the Tax