The government imposes a tax on imported wine. As a result, fewer individuals purchase imported wine. This is an example of tax

A) equity.
B) shifting.
C) evasion.
D) incidence.

Question

The government imposes a tax on imported wine. As a result, fewer individuals purchase imported wine. This is an example of taxA)  equity.B)  shifting.C)  evasion.D)  incidence.

imani gooden · Accepted Answer

Final Answer : B, Explanation :  Tax shifting occurs when the burden of a tax is passed on from the entity legally responsible for it to another party, such as consumers. In this case, the tax on imported wine likely raises its price, leading to decreased demand as consumers bear the cost.

The government imposes a tax on imported wine. As a result, fewer individuals purchase imported wine. This is an example of tax

A) equity.
B) shifting.
C) evasion.
D) incidence.

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