Question

Match each type of tax with an example of its use.

Answer 1

Answer:

Excise tax              :$0.30 tax on a gallon gasoline

Consumption tax  : 20% tax on wages earned

Income tax            : 9% tax on the sale of luxuries

Explanation:

Excise tax are the taxes charged to individuals on purchase of certain goods. Excise taxes are included with the price of the product. One of the major excise tax is charged on the gasoline for vehicles.

Consumption tax are the indirect taxes that are charged on usage of goods and services. They are collected in the form of sales tax and value added tax.

Income tax is the tax collected by the government for earning money through business or work.