A country’s government chooses to increase the share of tax revenue that comes from direct taxes and to decrease the share that comes from indirect taxes. What is likely to happen to the distribution of income and to work incentives?
- Adistribution of income: less equal; work incentives: decrease
- Bdistribution of income: less equal; work incentives: increase
- Cdistribution of income: more equal; work incentives: decrease
- Ddistribution of income: more equal; work incentives: increase