Low-income families pay a greater share of their income in consumption taxes than higher-income families.

Question

Quizplus · Accepted Answer

Consumption taxes, such as sales tax and excise tax, are generally flat taxes meaning they are applied at the same rate regardless of income level. This means that low-income families, who have a smaller disposable income, end up paying a greater share of their income in consumption taxes compared to higher-income families who have a larger disposable income.

Low-Income Families Pay a Greater Share of Their Income in Consumption