Indirect tax

Question 1

Tax in singapore

Answer 1

• Singapore goods and services tax is 7% on all goods and services

Question 2

Increase in excise tax rate in New York State on ciggs

Answer 2

• Increased from $4.35 to $5.35 / pack of 20
• Governments benefit however, licensed cigarette stamping agents and distributors suffer (in addition to consumers that have to pay higher prices)

Question 3

Canada’s National Carbon Tax

Answer 3

• $50 per ton of CO2 emitted by facilities emitting more than 50k tons of CO2 (specific indirect tax)
• The tax estimated to reduce greenhouse gas emissions by 85%
• Tax faced backlash from govts. of Ontario and Alberta suggesting it may have been politically motivated
• As a carbon tax is an indirect tax, it is regressive. However, there is a tax rebate (subsidy) for low income individuals

Question 4

Qatar implementing a 100% excise tax on Alcohol, an ad valorem tax example

Answer 4

• This doubled the cost of alcohol in Qatar and the World Cup host nation Qatar implements this making it 82 pounds a crate
• It can be argued that this may be religiously motivated as Qatar is largely a Muslim country and alcohol is prohibited under islamic law
• This will be extremely effective as 88% of Qatar’s population is foreign
• The revenue generated by this tax is likely to be invested into education and healthcare or other socially desirable assets.