Policymakers use taxes both to raise revenue for public purposes and to influence market outcomes.

Question

Quizplus · Accepted Answer

Policymakers use taxes as a tool to achieve various economic goals. They can be used to incentivize or discourage certain behaviors, such as higher taxes on tobacco products to discourage their use, or tax breaks for investment in renewable energy to encourage its growth. Taxes also provide revenue for the government to fund public goods and services.

Policymakers Use Taxes Both to Raise Revenue for Public Purposes