"Ad-valorem" refers to taxes levied on which of the following?

In proportion to the estimated value of the goods

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In proportion to the quantity of goods

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In levied at the time of selling and purchasing

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Solution

The correct option is A In proportion to the estimated value of the goods
Ad-valorem Tax is a kind of indirect tax in which goods are taxed by their values. In the case of ad-valorem tax, the tax amount is calculated as the proportion of the price of goods. Value Added Tax (VAT) is an ad-valorem tax.

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Similar questions

51. Consider the following statements

1. All ad valorem taxes are levied based on the determined value of the item being taxed.

2. A specific rate duty is a tariff levied in terms of a specific amount per unit, such as cents per kilogram.

Identify the correct statement/s.

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