What is the difference between progressive and regressive taxation?

Answer 1

In a progressive tax, the more you earn, the higher your tax rate.

In a regressive tax, the less you earn, the higher your tax rate.

The classical progressive tax is income tax.

The classical regressive tax is sales tax.

Answer 2

In progressive taxation, the amount of tax levied increases with the amount that is to be taxed. For instance, at 10,000 the tax is 5% but at 20,000 the tax is 7%.

Regressive is the opposite, the tax rate decreases as the amount of money being taxed increases. So at 10,000 the tax is 5%, but at 20,000 he tax is 4%. Regressive taxation was meant to insure that one person did not pay more than any other person, but that ALL people are taxed at about the same amount.

Progressive taxes are quite popular when politicians want to divide the public against itself (which is nearly always) because they can count on people with less money to out-vote the people with more money.

Regressive taxes tend to be more fair in that each citizen will contribute about the same amount, the principle being that whatever government function is being funded by that tax is used equally by all citizens.

Answer 3

A progressive method is one in which the [marginal] rate of tax increases as the amount that is subject to taxation increases. A regressive method is one in which the rate decreases as the amount increases. A regressive tax system takes proportionately more money in tax from somebody on a lower income than someone on a higher income.

Answer 4

Exerise taxes are regressive

Answer 5

Depends on who you talk to.