Suppose two individuals have identical incomes.One of them has a house worth $100,000 and the other has a house worth $200,000.The local government levies a tax of $500 on each of them,as it does on the homes of the rest of its residents.What kind of tax is this?

Question

Quizplus · Accepted Answer

A lump-sum tax is a fixed amount of tax that individuals are required to pay, regardless of their income, wealth, or consumption. In this scenario, both individuals are required to pay the same tax amount ($500) despite the difference in the value of their homes, which indicates the tax is not based on property value, income, or specific benefits received, but is instead a fixed amount for all, characteristic of a lump-sum tax.

Suppose Two Individuals Have Identical Incomes