Get premium membership and access revision papers, questions with answers as well as video lessons.

Got a question or eager to learn? Discover limitless learning on WhatsApp now - Start Now!

Taxation Economics And Policy Question Paper

Taxation Economics And Policy

Course:Taxation Economics And Policy

Institution: Kenyatta University question papers

Exam Year:2013

KENYATTA UNIVERSITY
UNIVERSITY EXAMINATIONS 2012/2013
SECOND SEMESTER EXAMINATION FOR THE DEGREE OF BACHELOR OF ECONOMICS.
EAE 301: TAXATION ECONOMICS AND POLICY.
DATE: Thursday 4th April 2013, TIME: 11AM-1PM
INSTRUCTIONS
Answer questions ONE and any other TWO questions. Question ONE carries 30 marks while the rest carry 20 marks each.

QUESTION ONE (COMPULSORY)
a) Use appropriate illustrations to explain the measurement of excess burden of taxation (8marks)

b) Kenya’s new constitution introduces devolved units of government. Clearly explain public services that would be efficiently provided by the central government in this set up (6marks)

c) Describe the challenges the devolved units are likely to encounter in resource mobilization to support the activities. How can the challenges be overcome? (6marks)

d) Distinguish between the following terms as used in tax policy design and administration
(i) Tax avoidance and tax evasion (2marks)

(ii) Benefit principle and ability to pay principle (2marks)

(iii) Unit tax and advalorem tax (2marks)

(iv) Tax burden and tax incidence (2marks)

Question Two
a) Explain the major issues that dominate tax reform debates in developing countries (8marks)

b) Corporate income tax subjects corporate profit to double taxation. Discuss (5marks)

c) State the major tax deductions from adjusted gross income that are allowed in computing taxable income. What are the economic justifications and consequences of such deductions (7marks)

Question Three
a) Apart from being the major source of public revenue, explain other objectives of tax policy in developing countries (8marks)

b) Use appropriate examples from your country to demonstrate that debt crises in developing countries are as a result of poor debt management (6marks)

c) Explain how the sectoral shares of total value added influences tax effort in countries. (5marks)

Question Four
The government tax policy can affect the economic activity in an economy through its effect on incentives to work, savings and risk taking. Explain (20marks)

Question Five
a) Use appropriate illustrations to show that the incidence of a commodity tax depends on the elasticity of demand and the elasticity of supply of the commodity (10marks)

b) Explain possible ways of reducing tax evasion in developing countries (10marks)

Taxation Economics And Policy Question Paper

More Question Papers

Popular Exams