The federal income tax is an example of a
A)progressive tax.
B)regressive tax.
C)proportional tax.
D)value-added tax.

Question

Quizplus · Accepted Answer

The federal income tax is a progressive tax, meaning that as income increases, the tax rate also increases. This approach is designed to make the tax system more equitable and to ensure that those who earn more pay a higher percentage of their income in taxes. A regressive tax, on the other hand, would require low-income earners to pay a higher percentage of their income in taxes than high-income earners, which is generally considered unfair. A proportional tax would apply the same tax rate to all taxpayers regardless of their income, which would also be perceived as unfair to low-income earners who would be disproportionately affected. A value-added tax is a tax on goods and services at each stage of production and distribution, which is not used in the United States.

The Federal Income Tax Is an Example of a