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Question
The essential feature of a tax.
Options
A compulsory payment
A legal payment
Both Compulsory payment and legal payment.
Neither Compulsory payment nor Legal payment
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Solution
Both Compulsory payment and legal payment.
Explanation:
A tax is both a compulsory payment and a legal payment. It is compulsory because it is mandatory for individuals and businesses and legal because taxes are imposed and collected under the authority of the law.
RELATED QUESTIONS
State two objectives of fiscal policy.
State the difference between income tax and expenditure tax.
Citing reason state the advantage of a progressive tax over proportional tax.
Give an example of Indirect tax.
How does the state fulfil the following socio-economic objective?
Environmental protection.
Define a tax.
State the four merits of a direct tax.
Explain the following with examples:
Progressive tax
Give two examples of direct taxes.
Explain briefly two merits of indirect tax.
