Public Expenditure and Taxation (AQA A-Level Economics): Flashcards

Proportion of income paid in tax rises as income increases

Proportion of income paid in tax falls as income increases

Cannot be shifted to someone else (e.g. income tax, corp tax)

Can be shifted to someone else (e.g. VAT, excise duties)

Spending on new infrastructure (hospitals, schools, transport)

Do not directly contribute to national output

Pensions rise by highest: wage increases, CPI inflation, or 2.5%

Automatically responds to economic conditions (e.g. unemployment)

20%

Marginal tax rate exceeds the average tax rate