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

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AProgressive tax.

BProportional tax.

CRegressive tax.

DFlat tax.

Answer:

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.

Related Questions:

Consider the following statements regarding the ‘Progressive taxation’:

I.Progressive taxation method has increasing rates of tax for increasing value or volume on which the tax is being imposed.

II.Progressive taxation method has increasing rates of tax for decreasing value or volume on which the tax is being imposed.

III. The idea of Progressive taxation is less tax on the people who earn less and higher tax on the people who earn more.

Which of the following statement(s) is/are correct?

Which of the following items are excluded from GST remittance?