Fiscal capacity:

Question

Fiscal capacity:

Quizplus · Accepted Answer

Fiscal capacity is a measure of a government's ability to provide public goods and services based on the financial resources available to it. It is closely linked to the level of economic development of a jurisdiction and its tax base. It is not dependent on the wealth of the community alone or the ability to export tax, but rather it is the combination of the economic capacity and the institutional capacity of a jurisdiction to raise, allocate and manage public resources. Mobility can impact fiscal capacity as well, as it affects the tax base, but it is not always a factor. Therefore, option B is the best choice as it directly explains what fiscal capacity is.

Fiscal Capacity