Question

A tax that falls more heavily on lower-income individuals as a percentage of their income is a:

• A. Progressive tax.
• B. Proportional tax.
• C. Regressive tax.
• D. Flat tax.

Answer 1

Answer:

C. Regressive tax.

• A regressive tax takes a larger percentage of income from those with lower incomes because it is typically a fixed amount or rate on a good that low-income and high-income earners consume equally.