What would be a “good” thing for the government to tax? This is a hard question, so please think about it 🙄 Some things to keep in mind:
Demand for the product can’t be too elastic or people will stop buying the product instead of paying the tax
The government tries to make taxes “fair” – they don’t want them to disproportionately impact people with lower incomes. This is why they don’t tax food at the grocery store, diapers, feminine products, etc.
**Note: it is totally okay to pick an item that is already taxed.
Please don’t forget to respond to a classmate to earn full credit.
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