Final answer:
A proportional tax may seem fair at first, but it often has regressive effects. Lower-income individuals end up paying a larger share of their income in taxes compared to higher-income individuals.
Step-by-step explanation:
A proportional tax may at first seem to be a fair form of taxation, but the effects are often regressive. In a proportional tax system, everyone pays the same percentage of their income in taxes. However, this means that individuals with lower incomes will end up paying a larger share of their income in taxes compared to individuals with higher incomes.
For example, consider a proportional tax rate of 10%. If Person A earns $10,000 and Person B earns $100,000, they would both pay $1,000 in taxes. However, $1,000 represents 10% of Person A's income, while it represents only 1% of Person B's income. This results in a heavier burden on lower-income individuals.
Therefore, while a proportional tax may initially seem fair, it can result in a regressive impact on individuals with lower incomes.