PRC-3 · Chapter 16 · Question 11 of 20
A government introduces an income tax where low-income earners pay 5% and wealthy executives pay 40%. This system, which satisfies the canon of equity by taxing the rich heavier, is explicitly a:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Progressive tax
Explanation
A progressive tax takes a larger percentage of income from high-income groups than from low-income groups, aiming to redistribute wealth.
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