An across-the-board income tax cut where all income taxes were cut by a constant percentage would

Question

Quizplus · Accepted Answer

A across-the-board income tax cut where all income taxes were cut by a constant percentage would necessarily go to higher income people and alter the after-tax distribution of income in favor of high income people. This is because higher income people pay a larger share of income taxes, so a cut in income taxes would result in a larger absolute amount of tax savings for higher income people. This cut would therefore not keep the after-tax distribution of income relationships constant.

An Across-The-Board Income Tax Cut Where All Income Taxes Were