Excise taxes are distortionary taxes.

Name: Excise taxes are distortionary taxes.
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Question

Quizplus · Accepted Answer

Excise taxes are distortionary taxes because they create an artificial increase in the price of goods and services, which can result in reduced consumer demand and shifts in production and consumption choices towards untaxed goods and services. This can lead to market inefficiencies and unintended consequences, such as the creation of black markets or increased government regulation.

Excise Taxes Are Distortionary Taxes