Which of the following is true?
A)A regressive tax rate structure imposes an increasing marginal tax rate as the tax base increases.
B)Regressive tax structures are the most common tax rate structure.
C)An example of a regressive tax is an excise tax.
D)In terms of effective tax rates, a sales tax can be viewed as a regressive tax.
E)None of the choices are correct.

Question

Quizplus · Accepted Answer

In terms of effective tax rates, a sales tax can be viewed as a regressive tax because it disproportionately affects low-income individuals as they spend a higher percentage of their income on taxable items compared to high-income individuals. Choice A is incorrect because it describes a progressive tax rate structure. Choice B is incorrect because progressive tax structures are more common. Choice C is incorrect because an excise tax can be either progressive, proportional, or regressive depending on how it is implemented.

Which of the Following Is True