# PTE Reading MCS #19: Historical Overview of...

Reading: Multiple Choice, Single Answer #19 - Level 3 - Feeds Reading

> Read the text and answer the question by choosing one option. Only one answer is correct.

Excise taxes are governmental levies on specific goods produced and consumed inside a country. They differ from tariffs, which usually apply only to foreign-made goods, and from sales taxes, which typically apply to all commodities other than those specifically exempted. In their modern farm, excise taxes were first developed by Holland in the 17th century, and established by law in England in 1643. Introduced into the Dutch colonies in America, the system spread to other colonies. Such taxes were first used by the federal government in 1791 and aroused great opposition. They were repealed (1802) in Thomas Jefferson's administration. During the War of 1812 comprehensive excise taxes were levied again but were repealed in 1817.

According to this text, how do excise taxes usually differ from tariffs?

- Excise taxes are levied on all products, while tariffs apply to government-made goods.
- Excise taxes are levied on specifically identified commodities, while tariffs apply to all goods.
- Excise taxes are levied on goods produced and consumed in one country, while tariffs apply to imports.
- Excise taxes are levied on goods to which sales tax does not apply, while tariffs only apply to goods With sales tax imposed.

## Answer

Excise taxes are levied on goods produced and consumed in one country, while tariffs apply to imports.

## Explanation

The text clearly distinguishes between domestic production/consumption for excise taxes and foreign-made goods for tariffs.

What to watch: Excise taxes apply to goods "produced and consumed inside a country," while tariffs "usually apply only to foreign-made goods." That matches imports. The option saying tariffs "apply to all goods" mixes up tariffs with sales taxes. Watch for answers that swap the details of the three tax types.

## Hints

- Focus on the first two sentences of the passage where the definitions are provided.
- Look for the specific phrase that explains what tariffs apply to compared to the definition of excise taxes.

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