Question 2
The table below shows the tax payments of four income earners in a year. Use the information in the table to answer the questions that follow.
| Income Earners |
Income Base |
tax | Payments |
| A | B | ||
| Jawara | 15,000.00 | 1,500.00 | 1,200.00 |
| Ade | 25,000.00 | 2,000.00 | 2,000.00 |
| Eke | 32,000.00 | 3,200.00 | 2,240.00 |
| Audu | 60,000.00 | 6,000.00 | 3,000.00 |
(a) Determine the percentage rate of taxation paid by
(i) Jawara in columns A and B.
(ii) Audu in columns A and B.
(iii) Ade in columns B.
(iv) Eke in column B
(b)(i) Identify the systems of taxation employed in columns A and B.
(ii) Which of the income earners have the least burden under column B?
(c) (i) If government increases its rate of taxation to 15% flat rate, how much revenue will be generated from the payees?
(ii) At 15% flat rate taxation, calculate the disposable incomes of Messrs Jawara, Ade, Eke and Audu.
Theory