Although the sales tax is levied proportionately, its incidence turns out to be regressive.

Name: Although the sales tax is levied proportionately, its incidence turns out to be regressive.
Brand: Quizplus
Rating: 4.8 (46 reviews)

Question

Quizplus · Accepted Answer

Sales tax is a flat percentage applied to the price of goods and services, which means that it disproportionately affects low-income households due to their higher consumption of basic necessities. This makes it regressive rather than progressive, as the tax does not increase proportionally with income.

Although the Sales Tax Is Levied Proportionately, Its Incidence Turns