Consider an income- tax system that requires all individuals to pay exactly 3 percent of their income. This income- tax system is

Question

Quizplus · Accepted Answer

A 3 percent income-tax system is proportional since everyone pays the same percentage of their income regardless of the amount of income they earn. It is not a lump-sum system since it is based on income. It is not regressive since the tax burden does not increase as income decreases. It is not fair since individuals with lower incomes would have a harder time paying the tax than those with higher incomes. Finally, it is not progressive since the amount of tax paid does not increase as income increases.

Consider an Income- Tax System That Requires All Individuals to Pay