BUISENESS MANAGEMENT
TAXES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The form of taxation adopted by the U.S. that taxes its citizens based on their incomes, taxing the wealthy at a higher rate ____ the higher your income, the higher your tax liability
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An individual’s gross income minus specific deductions
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The spending or disbursement of money
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None of the above
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Detailed explanation-1: -Definition: Progressive tax is the taxing mechanism in which the taxing authority charges more taxes as the income of the taxpayer increases. A higher tax is collected from the taxpayers who earn more and lower taxes from taxpayers earning less. The government uses a progressive tax mechanism.
Detailed explanation-2: -There are seven tax brackets for most ordinary income for the 2022 tax year: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37 percent.
Detailed explanation-3: -Investment income and estate taxes are examples of progressive taxes in the U.S.
Detailed explanation-4: -Progressive taxes exist so that the burden of paying for government services, oversight, and infrastructure doesn’t fall disproportionately on those earning lower incomes. With a progressive tax system, those who earn less are taxed less.