A state's basic individual income tax applies at a flat rate of 3.4 percent. Can the
distribution be progressive, at least in part?

Question

Quizplus · Accepted Answer

Even though the state's basic individual income tax applies at a flat rate of 3.4 percent, there is a personal exemption that can make the distribution progressive at the low end of the income range. The personal exemption is an amount of income that is not subject to tax and is subtracted from the taxpayer's gross income. This means lower-income individuals will end up paying a smaller percentage of their income in taxes compared to higher-income individuals. However, this only applies to the low end of the income range and not to the entire distribution.

A State's Basic Individual Income Tax Applies at a Flat