The city of Granby,Colorado recently enacted a 1.5% surcharge on vacation cabin rentals that will help pay for the city's new elementary school.This surcharge is an example of ________.
A) A sin tax to discourage undesirable behavior
B) A government fine
C) A sin tax to discourage undesirable behavior and An earmarked tax
D) An earmarked tax
E) None of the choices are correct

Question

Quizplus · Accepted Answer

The surcharge on vacation cabin rentals is an earmarked tax because the revenue generated from this tax is designated specifically for the purpose of funding the city's new elementary school. A sin tax is typically imposed on products or behaviors that are considered harmful to society, and a government fine is a punishment for breaking the law. Therefore, options A, B, and C do not apply in this scenario.

The City of Granby,Colorado Recently Enacted a 1