#1
Which tax is levied on the income of individuals and businesses?
Income Tax
ExplanationTax imposed on the earnings of individuals and businesses.
#2
In the context of taxes, what does VAT stand for?
Value Added Tax
ExplanationTax on the value added at each stage of production and distribution.
#3
In the context of taxation, what does the acronym IRS stand for?
Internal Revenue Service
ExplanationU.S. government agency responsible for tax collection and enforcement.
#4
What is the term for the total income on which the income tax is calculated?
Taxable Income
ExplanationThe income amount on which the calculation of income tax is based.
#5
In a progressive tax system, what happens to the tax rate as income increases?
Increases
ExplanationTax rate rises as income levels go up in a progressive tax system.
#6
What is the term for a tax that takes a higher percentage of income from high-income earners than from low-income earners?
Progressive Tax
ExplanationTax system where higher earners pay a higher percentage of their income.
#7
What is the primary purpose of excise taxes?
To discourage the consumption of specific goods
ExplanationTaxes imposed to reduce the consumption of certain goods.
#8
What is the term for a tax imposed on the import and export of goods?
Tariff
ExplanationTax on the trade of goods between countries.
#9
What is the term for a tax levied on the value of real estate?
Property Tax
ExplanationTax based on the assessed value of real estate.
#10
Which of the following is an example of an indirect tax?
Sales Tax
ExplanationTax collected by an intermediary, such as a retailer, from the consumer.
#11
What is the term for the income on which no income tax is imposed?
Exempt Income
ExplanationIncome not subject to income tax.
#12
Which tax is imposed on the transfer of property upon death?
Inheritance Tax
ExplanationTax on the transfer of property after someone's death.
#13
In a tax system, what is the difference between a credit and a deduction?
Credits reduce tax liability dollar-for-dollar, while deductions reduce taxable income.
ExplanationCredits directly reduce the amount of tax owed, while deductions lower taxable income.
#14
Which country is known for having a zero-income tax policy?
Singapore
ExplanationSingapore is recognized for not imposing income tax on individuals.
#15
In a tax system, what is the difference between a regressive tax and a proportional tax?
Regressive tax takes a higher percentage of income from low-income earners.
ExplanationTax that burdens lower-income individuals with a higher percentage of their income.
#16
In a tax system, what is the purpose of a tax credit?
To reduce tax liability dollar-for-dollar
ExplanationCredits directly reduce the amount of tax owed.
#17
What is the term for a tax on the transfer of assets during one's lifetime?
Gift Tax
ExplanationTax on the transfer of assets while the individual is still alive.