Which of the following concepts is most closely associated with a consumption tax?
A)Estate tax
B)User fees
C)Proportional tax
D)Value-added tax
E)Stabilization

Question

Quizplus · Accepted Answer

A value-added tax (VAT) is a type of consumption tax where a tax is levied on the value added at every stage of the production process, hence it is most closely associated with a consumption tax. Estate tax is a tax on the transfer of property at death, user fees are charges for specific government services, proportional tax is a tax where the average tax rate is the same at all income levels, and stabilization refers to government policies aimed at stabilizing the economy.

Which of the Following Concepts Is Most Closely Associated with a Consumption