Consider a system in which a person earning $10,000 pays $1,000 in taxes,a person earning $25,000 pays $1,000 in taxes,and a person earning $60,000 pays $1,000 in taxes.What type of tax is this?

Question

Quizplus · Accepted Answer

In a regressive tax system, the tax rate decreases as the income increases. Here, everyone pays the same amount ($1,000), which takes a larger percentage of income from lower earners, making it regressive.

Consider a System in Which a Person Earning $10,000 Pays