14. An efficient tax system is one that imposes small deadweight losses and small administrative burdens. 15. Tax loopholes often arise from ambiguities or omissions in the tax laws. 16. Tax evasion is legal but tax avoidance is illegal. 17. Lump-sum taxes are considered unfair to low-income taxpayers. 18. Deadweight losses arise because a tax causes some individuals to change their behavior. 19. When a tax does not have a deadweight loss the reduction in surplus is exactly offset by tax revenue collected by the government. 20. The administrative burden of any tax system is part of the inefficiency it creates. 21. Lump-sum taxes are equitable but not efficient. 22. Antipoverty programs funded by taxes on the wealthy are sometimes advocated on the basis of the benefits principle. 23. Vertical equity is not consistent with a regressive tax structure. 24. Resources devoted to complying with the tax laws are a type of deadweight loss. 25. According to one study the administrative burden of business taxes is ten times larger for small firms than for large firms. 26. In practice the U.S. income tax is filled with special provisions that alter a family’s tax based on its specific circumstances.
