The idea of two individuals being equally well off in the absence and existence of taxation is
A) time consistency of optimal taxation.
B) flat tax income schedule.
C) benefits received principle.
D) utility definition of horizontal equity.

Question

Quizplus · Accepted Answer

The concept described in the question is known as horizontal equity, where individuals in similar economic situations should be treated equally. The utility definition of horizontal equity states that two individuals with the same level of utility are equally well off, regardless of whether taxation exists or not. Therefore, option D, the utility definition of horizontal equity, is the best choice.

The Idea of Two Individuals Being Equally Well Off in the Absence