Annual incomes of James, Jack, and Stanley are $30,000, $50,000, and $80,000 and their tax rates are 10%, 20%, and 30% respectively.Which tax structure is this an example of?
A)Proportional tax
B)Progressive tax
C)Regressive tax
D)Digressive tax

Question

Annual incomes of James, Jack, and Stanley are $30,000, $50,000, and $80,000 and their tax rates are 10%, 20%, and 30% respectively.Which tax structure is this an example of?
A)Proportional tax 
B)Progressive tax 
C)Regressive tax 
D)Digressive tax

Quizplus · Accepted Answer

The tax rates increase as the incomes of individuals increase, hence, it is a progressive tax structure. James, who earns the lowest income, pays the lowest tax rate of 10%. Jack, who earns more than James, pays a higher tax rate of 20%. Stanley, who earns the highest income, pays the highest tax rate of 30%.

Annual Incomes of James, Jack, and Stanley Are $30,000, $50,000