Question

The social security tax is an example of a __________ tax structure because as the tax base increases, the taxes paid increase, but the marginal tax rate decreases.

Options:
A) Progressive
B) Regressive
C) Proportional
D) Graduated

Answer 1

The social security tax is an example of a regressive tax structure, where as the tax base increases, the taxes paid increase, but the marginal tax rate decreases.

Step-by-step explanation:

The social security tax is an example of a regressive tax structure. As the tax base increases, the taxes paid increase, but the marginal tax rate decreases. This means that individuals with higher incomes pay a smaller share of their income in taxes compared to those with lower incomes.