Regressive tax
A regressive tax is a
tax imposed so that the
effective tax rate decreases as the amount to which the rate is applied increases. The term "regressive tax" describes a distribution effect, which can be applied to any type of tax system (income or consumption) that meets the definition. It is frequently applied in reference to fixed taxes, where every person has to pay the same amount of money, such as a
poll tax. The term regressive refers to the way the rate progresses from high to low. The opposite of a regressive tax is a
progressive tax, where the tax rate increases as the amount to which the rate is applied increases. In between is a
proportional tax, where the tax rate is fixed as the amount to which the rate is applied increases. Regressive taxes reduce the
tax incidence of people with higher incomes, as they shift the incidence disproportionately to those with smaller incomes.
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Regressive tax
A tax system whereby average tax rates decrease with increases in individuals' income brackets.
Regressive Tax
a tax that takes a larger percentage of the income of low-income people than of high-income people. see also progressive tax, flat tax.
Regressive tax
A tax that tends to take a larger percentage of the incomes of lower income citizens than it takes from the incomes of higher income citizens. Examples: a poll tax, a flat percentage tax on only the first so many dollars of income (like the social security tax) or a sales tax on consumption items of common necessity (like groceries).
Regressive tax
Regressive tax
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