Suppose Daniel earns $10,000 and pays $1,000 in income taxes, Ramon earns $25,000 and pays $2,000 in income taxes, and Étienne earns $60,000 and pays $4,000 in income taxes.What type of taxation is this?

Question

Quizplus · Accepted Answer

This is an example of regressive taxation because as income increases, the percentage of income paid in taxes decreases. Daniel pays 10%, Ramon pays 8%, and Étienne pays about 6.67% of their incomes in taxes, showing a decrease in tax rate with an increase in income.

Suppose Daniel Earns $10,000 and Pays $1,000 in Income Taxes