CHAPTER 14 TEXTBOOK CARDS 3.0 / 5 based on 1 rating ? EconomicsA2/A-levelAQA Created by: hayley ashtonCreated on: 06-03-13 11:35 4 Main objectives of the UK Tax System? 1.Funding government spending 2.Managing the economy as a whole 3.Redistribution of income 4.Correcting market failure 1 of 15 4 examples of direct taxes? 1.Income 2.Inheritance 3.Capital Gains 4.Corporation 2 of 15 2 examples of indirect taxes? 1.VAT 2.Excise duties 3 of 15 6 principles of taxation? 1.Economical 2.Equitable 3.Convenient 4.Certain 5.Efficient 6.Flexible 4 of 15 5 arguements for indirect taxation? 1.Influencing spending patterns 2.Correcting externalities 3.Incentive Effects 4.Flexibility 5.Choice 5 of 15 4 arguements against taxation? 1.Distributional effects 2.Inflationary effects 3.Crime 4.Lack of announcement effect 6 of 15 3 types of government expenditure? 1.Capital 2.Current 3.Transfer payments 7 of 15 Balance, deficit and surplus budgets? G=T (balanced) G>T (deficit) G<T (surplus) 8 of 15 3 problems of a budget deficit? 1.Financing deficit 2.Growing national debt 3.Fiscal 'crowding out' 9 of 15 3 microeconomic effects of fiscal policy? 1.Incentives to work 2.Patterns of demand 3.Business Investment 10 of 15 Discretionary/Active fiscal policy? Deliberate manipulation of givernment spending and taxes to influence the economy. EG. Government cutting income tax rates 11 of 15 2 limitations of fiscal policy? 1.Time lags involved 2.Crowding out the private sector 12 of 15 2 divisions of supply side policies? 1.Labour market measures 2.Product market measures 13 of 15 4 labour market measures? 1.Lower rates of income tax 2.Reducing state welfare benefits and 'welfare to work' 3.Education and training 4.Trade union reforms 14 of 15 5 product market measures? 1.Deregulation 2.Private ownership of former public owned organisations 3.Tougher competition policy 4.Capital spending 5.Low corporation tax 15 of 15
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