Economics Week 1

Indirect Taxes raise more revenue for the Commonwealth than direct taxes on individuals and business.

• True

• False

In a progressive tax system, the percentage of tax payable increases as income rises.

• True

• False

In a regressive tax system, the percentage of tax payable remains constant as income rises.

• True

• False

Transfer payments are cash welfare payments from the government to individuals and households.

• True

• False

Which of the following options is NOT an example of indirect tax

• GST

• Excise Tax

• Company Tax

• Customs Duty

Adam Smith put forward how many basic principles which are still regards as the basis of a sound taxation system?

• Principle of equality

• Principle of economy in collection

• The quality of certainty

• The quality of convenience

The collection of income tax redistributes income in Australia.

• True

• False

Transfer payments satisfy which of Adam Smith's principles of tax?

• Equity

• Collection Cost

• Convienience

• Certainty

A large percentage of individuals who receive transfer payments pay little or no income tax. What rate of tax are these individuals incurring?

Indirect taxes have a positive impact on the aggregate level of spending.

• True

• False