L
Ladycroft
Guest
Some critics of tax increases on cigarettes suggest that an increase in the tax will reduce the revenue that the government collects. For low- and middle-income countries, is this likely? (Assume that taxes account for one half of the retail price of cigarettes and that the entire amount of the tax increase shows up as an increase in the retail price.)
Options:
1. Yes. With a 10% tax increase, tax revenue should fall.
2. No. With a 10% tax increase, tax revenue should increase.
3. Uncertain. From the information in this article, you can't tell what the effect would be on tax revenue.
Options:
1. Yes. With a 10% tax increase, tax revenue should fall.
2. No. With a 10% tax increase, tax revenue should increase.
3. Uncertain. From the information in this article, you can't tell what the effect would be on tax revenue.