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Most taxes can be classified as progressive, proportional or regressive.
A progressive tax takes a larger percentage of a higher income and a smaller percentage of a lower income. The federal income tax is the best known example of a progressive tax.
A proportional tax takes the same percentage of all incomes, regardless of size.
A regressive tax is one that takes a higher percentage of a low income and a lower percentage of a high income. Although they are not based on a person’s income, sales taxes have a regressive effect because they take a larger share of earnings from a low-income taxpayer than from a high-income taxpayer.
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Income
Taxpayers
The Federal Income Tax
Taxes
