Flat Tax Flashcards
1
Q
Define a Flat Tax
A
Putting a specific tax ( eg. £1 per packet) on a unit of goods
2
Q
Examples of goods that Weill have a Flat Tax applied to them.
A
- Cifgarettes
- Fuel
- Alcohol
- Sugar
- Pesticides
3
Q
Why does the Government apply Flat Taxes?
A
- Natural Fundraiser
- To deter people from buying the product
4
Q
Why does the government tax cigarettes and alcohol?
A
- Discourage the use of the product
- Long - term prevents further NHS and Policing costs
- Source of Tax revenue
- Investing tax revenue into ‘cleaning up’ the industry.
5
Q
Problems of Flat Taxes
A
- Takes a long time to generate substantial revenue
- Creates a Black Market
- Police have to crack down down on people avoiding the tax causing more government spending
- Poorer people will be worst affected
