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Explain four reasons why the government may find it necessary to impose tax.

      

Explain four reasons why the government may find it necessary to impose tax.

  

Answers


joseph
i. To raise revenue to finance government expenditure.

ii. To discourage consumption of certain products like cigarettes.

iii. To discourage importation of certain product in order to boost local production.

iv. To reduce inequality in income distribution by taxing the rich and financing activities that benefit the poor members of the society.

v. To reduce inflation by reducing people’s disposable income.

vi.To correct balance of payment by taxing imports in order to discourage importation.

vii.To influence location of firms by heavily taxing businesses in certain areas and giving tax benefits to business located in desired areas.
joseph rimiru answered the question on January 1, 2018 at 07:00


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