00:02
What is meant by a progressive tax? a regressive tax? a proportional tax? comment on the progressivity or regressativity of each of the following taxes, indicating in each case where you would think the tax incidence lies.
00:19
So progressive tax is a tax where the rate of taxation increases as income increases.
00:25
This way, those who are rich, it's taxed more in both absolute more money being taxed and relative terms, meaning a larger percentage of their income is taxed.
00:36
A regressive tax is a tax where the rate of taxation decreases as income increases.
00:41
This way, those who are rich get taxed less as a proportion of their income than the poor.
00:46
The absolute amount that is taxed may or may not increase with income, but the tax as a proportion to income will always decrease.
00:55
A proportional tax is a tax where the rate of taxation is the same for all levels of income.
01:02
The federal personal income tax, this is a progressive tax since the rates of taxation increase as income increases...