noun
incidence
The distribution of a tax burden among those who ultimately bear it.
The economist studied the incidence of the sales tax.
Etymology
The Latin verb means to fall upon. Tax incidence asks on whom the burden ultimately falls, rather than merely identifying who first hands over the payment.
More examples
- The tax’s legal payer does not necessarily determine its economic incidence.
- The report traced tax incidence across income groups.
- Changes in prices shifted the incidence toward consumers.
Forms
incidence
Similar words
- liability
- Liability identifies who must pay the tax legally; incidence concerns who ultimately bears its economic cost.
- tax burden
- Tax burden names the cost itself; incidence identifies how that cost falls on different people.