LESON19B - Econ 275 - Public Finance - Winter 1994 -...

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Econ 275 - Public Finance - Winter 1994 - 3/15/94 - Lesson #19 - leson18b.275-- Page -- Admin: Talk about Class projects. Grading. Next reading assignment, handout for next thursday. Taxation - Chapter 10 (mostly fluff) Terms Difference between tax and fee? Ad valorem tax excise tax tax base average tax rate marginal tax rate progressive, regressive tax structure(based on average tax rate) tax bracket How should taxes be distributed benefit principle--he who receives a benefit should pay. A rider of public transport should pay the cost. UTA example: $30 M annual cost, ridership fees about $6 M. ability to pay principle--he who has pays more Horizontal equity-people in the same economic situation should pay the same in taxes. Vertical equity--people of differing incomes pay taxes differentially according to some notion of fairness. Basic guidelines for tax policy Equity: tax should follow commonly held notions of fairness Efficiency: raise revenues with a minimum in loss of output in the economy Administrative ease and transparency Tax evasion versus avoidance Alternatives to taxation Debt Inflation Donations User fees Ch 11 - Taxation and efficiency (seel leson23a.475, leson19a.275 and leson20a.275) Important points: Printed:
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This note was uploaded on 07/08/2010 for the course ECON 275 taught by Professor Mcintyre during the Winter '05 term at BYU.

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LESON19B - Econ 275 - Public Finance - Winter 1994 -...

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