consumption taxes
Spending-based government revenue
Consumption taxes are levies on spending rather than income or wealth.
Sales tax, value-added tax (VAT), and excise taxes on specific goods like fuel or alcohol are common forms.
The term often appears in policy debates about tax reform: Shifting to consumption taxes would encourage saving.
Critics argue they burden lower-income households disproportionately since they spend a higher share of their earnings.
- VATIncremental consumption tax
- customs dutyTax on imported merchandise
- congestion chargeFee for entering busy areas
- import dutyTax on incoming goods
tax base
consumption taxesincome taxes
Government's share of earnings
wealth taxes · payroll taxes · capital gains taxes · estate taxes · inheritance taxes
consumption, taxes, consume, consumer, consumers, consuming, consumed, consumable, consumables