Final answer:
Stealth taxes have the effect of generating additional taxes from higher income taxpayers. A stealth tax is a form of indirect tax that is hidden in the cost of goods or services, making it less visible to taxpayers.
Step-by-step explanation:
Stealth taxes have the effect of generating additional taxes from higher income taxpayers. A stealth tax is a form of indirect tax that is hidden in the cost of goods or services, making it less visible to taxpayers. It typically affects higher income individuals more because they tend to purchase more goods and services that are subject to these hidden taxes.
For example, let's say there is a stealth tax on luxury cars. Higher income taxpayers who can afford to buy luxury cars will end up paying more in taxes compared to lower income taxpayers who cannot afford such expensive purchases.
Therefore, stealth taxes can indeed generate additional taxes from higher income taxpayers due to their purchasing power and consumption patterns.