The government receives money through taxes. Which of the following is NOT an example of a federal tax?

• A. Corporate tax
• B. Income tax
• C. Sales tax
• D. Excise tax

Answer: (C)

Verified step by step guidance

1. Step 1: Understand the types of taxes collected at different government levels. Federal taxes are imposed by the national government, while state and local governments impose their own taxes.
2. Step 2: Identify common federal taxes. Examples include corporate tax, income tax, and excise tax, which are collected by the federal government.
3. Step 3: Recognize that sales tax is typically imposed by state and local governments, not the federal government.
4. Step 4: Compare each tax option to determine which one is not a federal tax. Since sales tax is collected at the state or local level, it is not a federal tax.
5. Step 5: Conclude that among the options given, sales tax is the correct answer as it is NOT an example of a federal tax.