If low-income households spend a larger share of their budget on food than do high-income households a tax on food is

Question

Quizplus · Accepted Answer

A regressive tax takes a larger percentage of income from low-income households than high-income households. Since low-income households spend a larger share of their budget on food, a tax on food would have a greater impact on them. This makes it a regressive tax, which is not an effective way to redistribute from the wealthy to the poor.

If Low-Income Households Spend a Larger Share of Their Budget