Which of the following are taxes imposed as a fixed percentage of the price of a commodity ?
Ad valorem taxes are charged as a fixed percentage of a commodity's price. Their monetary amount per unit rises when the price rises. A unit tax instead specifies an amount…
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Which of the following are taxes imposed as a fixed percentage of the price of a commodity ?
Answer and explanation
Correct answer A
Ad valorem taxes are charged as a fixed percentage of a commodity's price. Their monetary amount per unit rises when the price rises. A unit tax instead specifies an amount per physical unit, while a lump-sum tax does not vary with the commodity's price or quantity.
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Jammu & Kashmir and Ladakh SET (JKSET/LASET)