Question 22N.3.HL.TZ0.2a.vii
| Date | November 2022 | Marks available | [Maximum mark: 4] | Reference code | 22N.3.HL.TZ0.2a.vii |
| Level | HL | Paper | 3 | Time zone | TZ0 |
| Command term | Explain | Question number | a.vii | Adapted from | N/A |
Table 6 shows selected tax revenue sources and the Gini coefficient for Turkey, Austria, Germany and the OECD average.
Table 6
1 2018 data
2 2019 data
[Source: Enache, C., 2020. Sources of Government Revenue in the OECD, 2020 [online] Available at:
https://taxfoundation.org/sources-of-government-revenue-in-the-oecd-2020/ [Accessed 29 September 2021].
Source adapted.
Tax Foundation, n.d. Taxes in Turkey [online] Available at: https://taxfoundation.org/country/
turkey/#:~:text=Individual%20Taxation%20in%20Turkey&text=These%20taxes%20are%20typically%20
progressive,addition%2C%20countries%20have%20payroll%20taxes [Accessed 29 September 2021].
Source adapted.
Tax Foundation, n.d. Taxes in Austria [online] Available at: https://taxfoundation.org/country/austria
[Accessed 29 September 2021]. Source adapted.
Tax Foundation, n.d. Taxes in Germany [online] Available at: https://taxfoundation.org/country/
germany/#:~:text=Sources%20of%20Revenue%20in%20Germany,and%20services%2C%20and%20
property%20taxes [Accessed 29 September 2021]. Source adapted.]
Using the data in Table 6, explain why a greater reliance on indirect taxes compared to income taxes for revenue collection is often associated with a higher Gini coefficient value.
[4]
Most candidates were able to use the data in order to confirm the relationship between taxation policy and the Gini coefficient. However, many neglected to explain the concepts of progressive and regressive taxation and link them to direct and indirect taxes in order to fully explain the relationship.
