taxation and govt revenue (3)

What are the four major sources of Commonwealth tax revenue?

Personal income tax, company tax, GST and excise duties.

What is a tax base?

The thing being taxed, such as income, wealth, property or spending.

What is a direct tax?

A tax paid directly by the taxpayer that cannot be passed on.

Give two examples of direct taxes.

Personal income tax and company tax.

What is an indirect tax?

A tax that can be passed onto consumers through higher prices.

Give two examples of indirect taxes.

GST and excise duties.

What is personal income tax?

A tax on income earned by individuals.

Why is personal income tax important?

It is the largest source of Commonwealth Government revenue.

What is company tax?

A tax paid by businesses on their profits.

What is profit?

Revenue minus expenses.

What is GST?

A broad-based tax on consumer spending.

What is excise duty?

A tax on specific products such as tobacco, alcohol and fuel.

Why does the government impose excise duties?

To raise revenue and discourage consumption of harmful goods.