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Income Tax vs Consumption Tax

Income Tax vs Consumption Tax

After completing the lecture and reading assignments, write a 500-word response to the following question. Do not use the task in your response.

  • How could the current personal income tax be modified so that it becomes a consumption tax? In what way can consumption be regarded as a better index of ability to pay taxes than income? Does an income tax penalize the saver while a consumption tax does not?

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