CIMA Exam CIMAPRA19-F01-1 Topic 6 Question 69 Discussion

Actual exam question for CIMA's CIMAPRA19-F01-1 exam

Question #: 69
Topic #: 6

[All CIMAPRA19-F01-1 Questions]

Why are excise duties an attractive method of raising tax for governments?

Select TWO that apply.

ALow cost of collection compared to other forms of taxation.

BHigh yields from the tax.

CEncourages consumption of products such as alcohol.

DPopular form of tax for the tax payer as it can be reclaimed.

EEnsures that the tax levied on all taxpayers is the same irrespective of their spending habits.

Show Suggested Answer

Suggested Answer: D

by Loren at Apr 19, 2023, 01:43 PM

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10 days ago

Ooh, excise duties sound like a real party trick for the government! Low cost of collection and high yields? Sign me up for the tax collector's ball!

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13 days ago

But some people may not like it as it encourages consumption of certain products.

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14 days ago

Yes, and they also generate high tax revenues for the government.

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15 days ago

Excise duties are attractive because they have low collection costs.

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