Describe what is the incidence of tax, Taxation

 Tax incidence can be separated into-

1. Formal incidence: the party liable to the tax
2. Informal incidence: party, who really pays the tax

The tax incidence is decided by the elasticity of demand and supply for a good or service.

 

Posted Date: 4/1/2013 1:29:02 AM | Location : United States







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