T has a tax base of $30,000 and pays a tax of $2,500 on the first $25,000 and $750 on the next $5,000.This is an example of what type of tax rate?
A)Proportional
B)Progressive
C)Regressive
D)Neutral
E)None of the above

Question

Quizplus · Accepted Answer

The tax rate on the first $25,000 is 8.33% ($2,500/$30,000), but the tax rate on the remaining $5,000 is 15% ($750/$5,000). As the tax rate increases as the tax base increases, this is an example of a progressive tax rate.

T Has a Tax Base of $30,000 and Pays a Tax