Final answer:
The United States does not tax C corporations using a progressive tax rate system, this is B. false. After recent tax reforms, C corporations pay a flat corporate tax rate of 21%, regardless of their income level. Previously, corporate tax rates did increase with higher income brackets, but that is no longer the case.
Step-by-step explanation:
The statement that the United States taxes C corporations on their income using a progressive tax rate system is false. Unlike individual income taxes, which are indeed progressive, federal corporate income taxes for C corporations used to be calculated based on graduated rates, but after recent tax reforms, a flat tax rate is now applied.
As of 2018, the Tax Cuts and Jobs Act reduced the corporate tax rate to a flat 21%, overturning the previous system where the rate would increase with higher brackets of corporate income.
Under a progressive tax system, individuals or entities pay a higher percentage of their income as they earn more. This is designed to ensure that those with higher incomes contribute a greater share of their earnings than those with lower incomes. The intention behind this is to balance the burden of taxation across all economic levels.
This means that while individual taxpayers may see their tax rates increase with higher income brackets under the U.S. progressive tax system, C corporations currently do not have increasing rates based on their profits and hence do not operate under a progressive tax rate system.