QUESTION IMAGE
Question
fill in the blank: ______ tax systems tax wealthier people the most. 1 progressive. 2 flat. 3 regressive.
A progressive tax system is structured such that the tax rate increases as the taxable income (or wealth, in a broader sense) of an individual increases. This means wealthier people are taxed at a higher rate (and thus pay more in absolute terms, and a higher percentage of their income/wealth) compared to those with lower income/wealth. A flat tax system applies the same tax rate to all individuals regardless of income, and a regressive tax system has a tax rate that decreases as income/wealth increases (so wealthier people pay a lower percentage of their income/wealth in taxes). So the correct term for a tax system that taxes wealthier people the most is "Progressive".
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- Progressive