If a flat tax plan allowed individuals to deduct a standard allowance of $20,000 and the flat tax rate was 20 percent, an individual earning $100,000 would pay an average tax rate of 20%.

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First, the individual would deduct the standard allowance of $20,000 from their income, leaving them with taxable income of $80,000. Then, applying the flat tax rate of 20%, the individual's tax liability would be $16,000.

To calculate the average tax rate, we divide the total tax liability ($16,000) by the taxable income ($80,000), resulting in an average tax rate of 20%.

Therefore, the individual earning $100,000 would actually pay an average tax rate of 16%, not 20%.

If a Flat Tax Plan Allowed Individuals to Deduct a Standard