Question

Is a system that increases the effective tax rate as the taxpayer's income increases.

(A) Flat taxation
B) The fair tax
C) Progressive taxation
(D) Regressive taxation
Question 7

Answer 1

Progressive taxation is a system that increases the effective tax rate as the taxpayer's income increases.

Step-by-step explanation:

The correct answer is Progressive taxation. Progressive taxation is a system that increases the effective tax rate as the taxpayer's income increases. This means that individuals with higher incomes pay a higher percentage of their income in taxes compared to those with lower incomes.

For example, let's say there is a progressive tax system with three income brackets: 10%, 20%, and 30%. If a taxpayer falls into the highest income bracket, they would pay 30% of their income in taxes, while someone in the lowest income bracket would only pay 10%.

Progressive taxation is aimed at redistributing wealth and achieving a more equitable distribution of resources in a society.

Learn more about Progressive taxation