Question

Janette wants to take her family on a short vacation to Orlando, Florida. In addition to paying tax on the gasoline for the rental car, Janette was surprised to learn about the tax on airline travel.

The tax imposed on gasoline and airline travel is what type of tax?

a. sales tax
b. business tax
c. public good tax
d. excise tax

Answer 1

The tax imposed on gasoline and airline travel is an excise tax, which is a tax on specific goods like gasoline, cigarettes, and alcohol that can also discourage consumption or serve as a charge for negative externalities.

Step-by-step explanation:

The tax imposed on gasoline and airline travel is known as an excise tax. An excise tax is a specific kind of tax that is levied on the sale, production, or consumption of particular goods or services. Common examples include gasoline tax, cigarette tax, and taxes on alcohol such as beer and liquor. The purpose of excise taxes can be to either discourage consumption of certain products, often referred to as demerit goods, or to generate revenue from items that are inelastic in demand, meaning consumers will continue to buy them despite the additional tax. Additionally, these taxes can serve as a charge for the negative externalities produced by the consumption of these goods, such as pollution from gasoline, and can be earmarked for related expenditures, such as the maintenance of roads in the case of fuel taxes.

Answer 2

d. excise tax

Step-by-step explanation:

Excise tax -

It refers to the tax , which is paid on certain type of goods and services , like the alcohol , tobacco , fuel , is referred to as excise tax.

These are basically for the business purpose and are the international level taxes , which is taken as soon as the person cross the boundary of the country.

These taxes are not noticed by the consumers directly.

Hence, from the given scenario of the question,

Janette is supposed to pay excise tax for gasoline and travel from airline.