Given the supply of land is fixed,who would pay a tax on land
A)the landowners
B)the renters or users of the land
C)partly landowners and partly land users
D)workers

Question

Quizplus · Accepted Answer

As the supply of land is fixed, the demand for land determines its price. Therefore, the burden of the tax on land will be passed on to the landowners by reducing the rental income they receive from the use of the land. This is known as the "tax incidence" and is typically borne by the party with less elasticity in their demand for or supply of the taxed item. In this case, the supply of land cannot be increased, so landowners have less ability to adjust their behavior to avoid the tax burden.

Given the Supply of Land Is Fixed,who Would Pay a Tax