If policymakers are concerned about the unequal distribution of income within society,then they should prefer a ________ tax system.

Question

Quizplus · Accepted Answer

A progressive income tax system is designed to tax individuals with higher incomes at higher rates than those with lower incomes, resulting in a more equal distribution of income in society. This type of tax system is preferred by policymakers concerned with income inequality. A regressive income tax system, on the other hand, taxes lower-income individuals at higher rates than higher-income individuals, exacerbating income inequality. A consumption tax system also tends to be regressive, as it taxes a larger proportion of income from lower-income individuals who must spend a higher percentage of their income on consumption. A proportional income tax system taxes all individuals at the same rate, regardless of income, which can also contribute to income inequality. A per capita tax system simply charges every individual the same flat tax amount, which does not take into account income levels or ability to pay.

If Policymakers Are Concerned About the Unequal Distribution of Income