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Question
Distinguish between a tax and a subsidy.
Distinguish Between
Solution
| Tax | Subsidy | ||
| (i) | A tax is a compulsory payment made by the people to the government. | (i) | A subsidy is a payment by the government to consumers or producers. |
| (ii) | Tax revenue is incurred for the welfare of society as a whole. | (ii) | It is given to improve the incomes of consumers or producers. It is just opposite to a tax. |
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