Which of the following taxes is most likely to be shifted?
A)a property tax on an owner-occupied residence
B)a progressive income tax
C)a flat-rate state income tax
D)a general sales tax

Question

Which of the following taxes is most likely to be shifted?
A)a property tax on an owner-occupied residence 
B)a progressive income tax 
C)a flat-rate state income tax 
D)a general sales tax

Quizplus · Accepted Answer

A general sales tax is most likely to be shifted because it is added to the price of goods and services, which can then be passed on to the consumer through higher prices. This makes it easier for businesses to shift the burden of the tax onto their customers. Property taxes on an owner-occupied residence cannot be shifted as easily, because the homeowner cannot simply raise the price of their home to pass on the tax burden. Progressive income taxes and flat-rate state income taxes are both levied on individuals based on their income, so they cannot be shifted as easily onto others.

Which of the Following Taxes Is Most Likely to Be