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JAMB Economics 1997 Question 37

Question 37

Public Finance

The use of legally permissible means to reduce tax liabilities is known as tax

  1. A.evasion
  2. B.avoidance
  3. C.relief
  4. D.exemption.
Show the answer and explanation

Answer: B (avoidance)

Explanation

Tax avoidance is using legal loopholes and allowances to pay less tax; tax evasion is illegal non-payment.