Asked by Emilija Dancetovic on Jun 01, 2024
Verified
(Figure: Income Tax Payments) Use Figure: Income Tax Payments.Which panel or panels BEST represent the effects of a regressive income tax?
A) A
B) B
C) C
D) A and B
Regressive Income Tax
A tax system where the tax rate decreases as the taxable amount increases, placing a higher relative burden on low-income earners.
- Examine the distinctions in progressive, proportional, and regressive taxation approaches.
Verified Answer
AN
Aniela NguyenJun 05, 2024
Final Answer :
C
Explanation :
A regressive income tax system imposes a higher tax rate on low-income earners than on high-income earners. Panel C best represents this as it shows a decreasing tax rate as income increases, which is characteristic of a regressive tax system.
Learning Objectives
- Examine the distinctions in progressive, proportional, and regressive taxation approaches.