Question

The city of Asheville charges each resident $10 a month to pick up trash. Is this a tax or fee?

Answer 1

A tax is a compulsory payment levied by the government on its citizens and various business firms on some percentage basis of activities / specific transactions like property tax, registeration charges or tax on income.

On the other hand, a fee of a fixed amount for the special services rendered to the citizens. This is paid by person, who is availing the services.

In view of the above, the charges of $10, by the city of Asheville is a fee for the services of pick up trash rendered by it.