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Vorland s government is planning a nationwide ban on smoking [#permalink]
01 Nov 2006, 17:24
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Vorlandâ€™s government is planning a nationwide ban on smoking in restaurants. The objection that the ban would reduce restaurantsâ€™ revenues is ill founded. Several towns in Vorland enacted restaurant smoking restrictions five years ago. Since then, the amount the government collects in restaurant meal taxes in those towns has increased 34 percent, on average, but only 26 percent elsewhere in Vorland. The amount collected in restaurant meal taxes closely reflects restaurantsâ€™ revenues.
Which of the following, if true, most undermines the defense of the governmentâ€™s plan?
A. When the state first imposed a restaurant meal tax, opponents predicted that restaurantsâ€™ revenues would decline as a result, a prediction that proved to be correct in the short term.
B. The tax on meals in restaurants is higher than the tax on many other goods and services.
C. Over the last five years, smoking has steadily declined throughout Vorland.
D. In many of the towns that restrict smoking in restaurants, restaurants can maintain separate dining areas where smoking is permitted.
E. Over the last five years, government revenues from sales taxes have grown no faster in the towns with restaurant smoking restrictions than in the towns that have no such restrictions.