Asume in Colorado the tax is levied on consumption of marijuana at a rate of 20%. Also suppose that most marijana users in this area, on average, young working adults between the ages of 22 and 32 with average income of$80 000 per year. These consumers spend, on average, 5% of their yearly income on marijuana. High shool and college students on the other hand, have a average income of $10 000 per year and spend only about 2% of their yearly income on marijuana.

2.1 When considering income as the tax base, is this tax proportional, regressive or progressive? (3) 2.2 Would you say that the earmarking of marijuana tax revenue for college scholarships is fair according to the benefit principle? Justify your stance. (5) 2.3 Evaluate the overall fairness of this tax. (10) QUESTION 3 In each of the following two scenarios, identify the type of tax system depicted in 3.1 and 3.2 respectively. (2) 3.1 Joshua, a sales consultant, graduated with a master's degree in August 2018. Due to his new qualification and experience, his boss decided to promote him to assistant sales manager in 2019. His promotion not only came with a new title, but also with a new salary. Before Joshua was promoted he earned R30 000 and paid 5% towards income tax. However, with this new promotion, Joshua will now earn R45 000 and he will contribute 11% towards income taxation. 3.2 Income/Inkomste Percentage of Amount of tax/ income paid in tax/ Hoeveelheid Persentasie van belasting inkomste aan belasting betaal Family A/ Gesin A 10 000 20% 2 000 Family B/ Gesin B 50 000 20% 10 000 Family C/ Gesin C 100 000 20% 20 000 TOTAL: 25 MARKS