Which option names a local tax used to fund city programs?

Which option names a local tax used to fund city programs?

• A. Municipal income tax
• B. City tax
• C. Local income tax
• D. Municipal sales tax

Answer: (C)

Local income tax is a tax levied by a city or local government on residents’ earnings to fund city programs and services. The phrase clearly identifies both the level of government (local) and the tax base (income), which matches the idea of a local tax used to support city operations like public safety, roads, and parks. A municipal income tax would serve a similar purpose, but the wording local income tax directly signals the local scope in this context. A city tax is too vague and not a standard designation for a specific tax type, and a municipal sales tax is a tax on purchases, not income, so it’s a different kind of levy used to fund city programs.

Local income tax is a tax levied by a city or local government on residents’ earnings to fund city programs and services. The phrase clearly identifies both the level of government (local) and the tax base (income), which matches the idea of a local tax used to support city operations like public safety, roads, and parks.

A municipal income tax would serve a similar purpose, but the wording local income tax directly signals the local scope in this context. A city tax is too vague and not a standard designation for a specific tax type, and a municipal sales tax is a tax on purchases, not income, so it’s a different kind of levy used to fund city programs.