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)An earmarked tax
D)A sin tax to discourage undesirable behavior and an earmarked tax
E)None of these

Question

Quizplus · Accepted Answer

An earmarked tax is a tax that is dedicated to a specific purpose, in this case, paying for the city's new elementary school through a surcharge on vacation cabin rentals. It is not a sin tax as it is not intended to discourage undesirable behavior, nor is it a government fine.

The City of Granby,Colorado Recently Enacted a 1