Government J decides that it must increase its tax revenue. Which of the strategies could result in more revenue?
A) Increase the rate of an existing tax.
B) Expand the base of an existing tax.
C) Enact a tax on a new base.
D) All of these strategies could result in more revenue for Government J.

Question

Quizplus · Accepted Answer

All of these strategies could result in more revenue for Government J.

A) Increasing the rate of an existing tax would generate more revenue from the same base of taxpayers.

B) Expanding the base of an existing tax could result in more taxpayers being subject to the tax, and therefore more revenue.

C) Enacting a tax on a new base would create a new source of revenue for the government.

Government J Decides That It Must Increase Its Tax Revenue