Which of these explanations of a "tax expenditure" is blatantly wrong?

• A. Tax expenditures are exclusions or exemptions from the standard tax code that benefit certain groups of people or certain behaviors. For instance, itemized deductions like charitable donations are tax expenditures.
• B. Tax expenditure is the government's use of taxes to purchase or pay for goods or services. One example of a tax expenditure would be paying Boeing to build a new military aircraft.
• C. Tax expenditures are provisions that reduces the amount of taxes that need to be paid. This could be in the form of charitable donations to decrease tax rates.
• D. Tax expenditure is the "revenue losses attributable to provisions of the Federal tax laws which allow a special exclusion, exemption, or deduction from gross income or which provide a special credit, a preferential rate of tax, or a deferral of tax liability." according to The Congressional Budget and Impoundment Control Act of 1974. Tax expenditures include deductions and inclusions, itemized deductions, and credits. An example of deduction is the deduction of mortgage income on personal residences.

Are tax expenditures good policy? Explain.

• A. Yes.
• B. No.
• C. I'm not sure.

Rationale:

What is your FAVORITE tax? Explain

• A. Sales tax
• B. Value-added tax
• C. Income tax
• D. Payroll tax
• E. Corporate tax
• F. Wealth tax
• G. Other: Explain in the rationale.

Rationale:

What do you find most appealing as a way to improve the federal tax system? Be sure to explain why.

• A. National retail sales tax
• B. Value-added tax
• C. Flattening tax rates (flat tax or x tax)
• D. Return-free filing
• E. Other (explain in rationale)

Rationale: