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A tax is "progressive" when the tax is higher on higher incomes, so that the more money you make, the higher the percentage you pay in taxes. A "regressive tax" is a tax that is higher on LOWER incomes, so that a low-income person pays a higher percentage in taxes than a low-income person would.
Highly progressive taxes are sometimes self-defeating. In England in the 1970's, for example, income taxes were at higher and higher rates up to the point that very high earners were paying 95% of their income in taxes. Since rich people have the freedom to move around, a high tax rate gives them an incentive to move. So after The Beatles recorded "Tax Man" ("That's one for you , 19 for me, Taxman!") John Lennon left England and moved to New York, taking ALL of his income with him. So he was paying 50% taxes to the US, and no taxes at all to England.
What else can I help you with?
Is payroll tax regressive or progressive?
Regressive
Is the sales tax progressive or regressive?
regressive
A regressive tax is BEST defined as a rate of tax?
A regressive tax is a rate of tax that falls as the income rises.
Why is a 5 percent sales tax on gasoline regressive?
This is a fixed rate (proportional) tax, not a regressive tax.
What is the principle that justifies a regressive tax?
The benefits-received principle justifies a regressive tax.
What is the advantage of regressive tax?
regressive tax encourages earning. this is such that as for the case of progressive tax whereby the more you earn, the more taxes you pay in the case of regressive tax, the more you earn the more you get to keep.
What kind of tax is the sales tax?
Regressive tax
What kind of tax is sales tax?
Regressive
Is a tax where every one pays the same percentage regressive?
regressive.
What countries practicing regressive tax?
the countries practicing regressive tax are japan, united states, china, Canada and Korea.
With this tax the tax rate decreases as the tax base increases?
Regressive
With this tax the tax rate decreases as the tax base increases.?
Regressive
