A country's government decides to raise the share of tax revenue collected through indirect taxes and to cut the share collected through income tax, while total tax revenue stays unchanged. What effects is this likely to have on the distribution of income and on 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