Question

Which of the following is an example of a tax based on the benefits principle?

a. ​An income tax
b. ​A lump-sum tax assessed on household in town to finance the construction of soccer fields
c. ​A gasoline tax imposed by a city to be used to upgrade facilities local high school

Answer 1

The correct option based on the benefits principle will be option b & c.

Step-by-step explanation:

According to taxes based on the benefits principle, the households or users are willing to pay a tax for the benefits received. In that question, options b and c are related to paying taxes and receiving two clear benefits like new soccer fields and upgrading the facilities of local high schools.