Answer:
(d) a tax levied on a specific product such as gasoline or alcohol
Step-by-step explanation:
The excise taxes that generate the biggest revenue at the federal level include fuel, airline tickets, tobacco, alcohol and health-related goods services.
Excise taxes can be used to price an externality or discourage consumption of a product that imposes costs on others.
Excise taxes are primarily taxes that must be paid by businesses, usually increasing prices for consumers indirectly.
Excise taxes can be ad valorem (paid by percentage) or specific (cost charged by unit).
Some excise taxes can be required directly from the consumer like property taxes and excise tax penalties on certain retirement account activities.
Federal, state, and local governments have the authority to institute excise taxes. While income tax is the primary revenue generator for federal and state governments, excise tax revenue also makes up a small portion of total revenue.
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