Asked by Shyam Hassan on Mar 10, 2024

Verified

If the marginal tax rate and the average tax rate are equal for all levels of income,then the tax structure is proportional.

Marginal Tax Rate

The rate at which the last dollar of income is taxed, reflecting the incremental rate applied to income in the highest tax bracket.

Average Tax Rate

The ratio of the total amount of taxes paid to the total tax base (income, expenditure, or asset), represented as a percentage.

Proportional

Characterized by or corresponding in size, degree, or intensity according to a fixed ratio or relationship.

- Recognize the fundamental elements of different fiscal regimes (progressive, regressive, and proportional) and their impacts on fairness and efficiency in the economy.

Verified Answer

EB

Erika Berning

Mar 10, 2024

Final Answer :

True

Explanation :

A proportional tax structure means that the tax rate remains constant for all levels of income. If the marginal tax rate and the average tax rate are equal, then the tax structure is proportional.

## Learning Objectives

- Recognize the fundamental elements of different fiscal regimes (progressive, regressive, and proportional) and their impacts on fairness and efficiency in the economy.