BUISENESS MANAGEMENT
TAXES
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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One where higher income earners have a higher percentage of their income taxed than lower income earners
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One where higher and lower income earners lose the same percentage of their income to taxes
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One where lower income earners have a higher percentage of their income taxed than higher income earners
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A tax proposed by the Democratic Party, as opposed to the Republican Party
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Detailed explanation-1: -Under a progressive tax system, the tax rate people pay increases as their income increases. This means that people with higher incomes get taxed at a higher rate than those with lower incomes do. The U.S. federal income tax is an example of a progressive tax system.
Detailed explanation-2: -If one tax code has a low rate of 10% and a high rate of 30%, and another tax code has tax rates ranging from 10% to 80%, the latter is more progressive. Income Tax, Luxury Sales Tax, Estate tax and surcharge on net income beyond Rs 50 Lakhs are a few examples of Progressive tax.
Detailed explanation-3: -What is a Progressive Tax. A Progressive tax is where taxes increase in line with incomes. In other words, the higher the income, the higher the rate of taxation. For example, someone earning $20, 000 a year may pay 10 percent in taxes, whilst someone else earning $80, 000 will pay 30 percent.
Detailed explanation-4: -regressive tax-A tax that takes a larger percentage of income from low-income groups than from high-income groups.
Detailed explanation-5: -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.