Tax shifting

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Updated: Aug 20, 2021

The passing of the tax burden from one economic agent to another. For example, the burden of a sales tax that is formally levied on a firm may be passed on to consumers in the form of higher prices. Generally, the tax burden is shared between economic agents with the precise allocation determined by elasticities of demand and supply.

Reference: Oxford Press Dictonary of Economics, 5th edt.



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James Knight
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James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.