10 Flashcards
1
Q
Transfer payments
A
Benefits
2
Q
Changing composition of UK public expenditure
A
Most money spent in pensions and welfare benefits
Followed by health and education
Defence spending falling
3
Q
What is the biggest source of government revenue
A
Income tax
4
Q
Effects of spending
A
Productivity and growth
Crowding out effect
Level of taxation
Equality
5
Q
Progressive tax
A
Tax increases as income increases
6
Q
Regressive tax
A
Those on the lowest incomes have highest average rate of tax
7
Q
Proportional tax
A
Fixed rate for all tax payers
8
Q
What does the laffer curve show
A
Increasing tax revenue will increase tax revenue up to a point
9
Q
Why do tax revenues fall
A
Disincentives to work harder
Emigration
Tax evasion/ avoidance
10
Q
Examples of redistributive tax
A
Inheritance tax
