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Fiscal policy

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Question 1

In 2023, the government of Colombia implemented a major tax reform aimed at reducing its fiscal deficit and addressing deep wealth inequality. The reform focused heavily on direct taxation, including introducing a permanent progressive wealth tax and increasing income tax rates on high earners, while avoiding broad-based increases in indirect taxes like Value Added Tax (VAT).

Evaluate the view that a government seeking to reduce income inequality while maintaining stable tax revenues should rely more on direct taxes than indirect taxes.

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Fiscal policy Questions

  1. A Level
  2. /Economics
  3. /Fiscal policy