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Measures to Promote EQUITY - Coggle Diagram
Measures to Promote EQUITY
How it's done? (2nd step)
Transfer Payments
the transfer means gov. pass on the collected taxes to the poor with no production taking place
"Gov. use tax revenues to redistribute income"
e.g. child support assistance, unemployment benefits, payments to disables
What measures? (1st step)
Government collect taxes
Regressive Tax- the average rate of tax decreases as the person’s income rises :warning:
Progressive Tax- the average rate of tax rises as the person’s income rises :explode:
Proportional Tax- the average rate of tax is constant :check:
Results? (last step)
Equity achieved!
Improving and sustaining a good standard of livings among citizens
the term equity;
fairness
, where gov. attempt to redistribute income to make the distribution more fair
How it's done? (2nd step)
Government expenditure
G&S that have positive externalities of consumption
"Gov. use large amount of the taxes collected to provide directly/subsidize G&S that are socially important"
to ensure and assist poorer people to gain access to essential social and economic development
e.g. health care, education, water supply