Regressive tax

A tax system that provides that average tax rates decrease with increases in individuals' income brackets.

Regressive Tax

A tax that is applied to all persons equally and therefore adversely affects persons with lower income. For example, if a city institutes a 5% sale tax on groceries, everyone who buys groceries (that is, everyone) must pay 5% extra. Because the poor and the lower middle class make less money than other classes, the extra 5% is more difficult for them to afford. As a result, regressive taxes are less popular among left-wing political groups. However, proponents argue that regressive taxes are fair, at least to a certain extent, because they do not punish success.

regressive tax

A tax that has a rate that declines as the amount to be taxed increases. In terms of income, federal and state taxation of cigarettes is regressive because low-income smokers pay a higher rate of taxation in terms of their income than high-income smokers do. A system of regressive taxation tends to free more funds for investment because high-income individuals tend to save a greater portion of their income. However, a regressive tax is often considered socially and politically unacceptable. Compare progressive tax.

Wall Street Words: An A to Z Guide to Investment Terms for Today's Investor by David L. Scott. Copyright © 2003 by Houghton Mifflin Company. Published by Houghton Mifflin Company. All rights reserved. All rights reserved.

Regressive tax.

A regressive or flat income tax system taxes everyone at the same rate, as sales tax does.

Advocates say it's simpler and does away with the kinds of tax breaks that tend to favor the wealthy. Opponents say that middle-income taxpayers carry too large a proportion of the total tax bill.

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References in periodicals archive

In the past four decades, Pakistan has undergone a sharp decline in progressive taxes and an unprecedented rise in Regressive Taxes. Some of the Acts of Law pertaining to Progressive Taxes have been abolished, though the Constitution still empowers the government to use these methods to boost Progressive or Direct Taxes.

Endogenous growth

A regressive tax is generally a tax that is applied uniformly to all situations, regardless of the payer adding a direct tax is paid directly by an individual or organization to an imposing entity.

Tax and Budget Advocacy under 'Finance for Development Project' an orientation program holds

He noted that the government had also abolished the Goods and Services Tax which was seen as a regressive tax system that burdened the lower-income group more.

Putrajaya wants 'fair' opportunities for all Malaysians, says Guan Eng

We need to give New Yorkers a break, and turn a regressive tax system into a fair and progressive one.

Report: Property taxes crushing New York families

Indeed, the health-care bill Republicans advanced in 2017 combined regressive tax cuts and regressive cuts to Medicaid.

Worsening Inequality: The Tax Act worsens inequality both in the tax changes and in the program cuts used to address the resulting deficit

FSB Chairman Mike Berry said: "This is a regressive tax that hits firms before they have made their first penny in turnover, let alone profit.

3.5% rates rise brings fear to the high street

It might also be an easier sell on both sides of the aisle because it will avoid accusations of regressive tax policy.

Private-sector budget fix proposal could be hard sell

Corporation tax is a pointless, regressive tax which should be removed altogether.

Corporation tax cut creates jobs

Despite all their bluster once again it appears that Fianna Fail have no commitment to scrap this regressive tax.

Varadkar warns water charges return is in the pipeline for next year

It would be a highly regressive tax that would hit low-income Oregonians the hardest, hurt small businesses as well as larger Oregon companies, make it harder for the state to recruit new businesses and hamper the growth of existing companies.

Gross receipts tax: No

VAT is a regressive tax that hits you harder the lower your income.

Hammond and May ponder big choices while Corbyn plays in the Wendy House; OFFERING A DIFFERENT PERSPECTIVE ON MERSEYSIDE BUSINESS SCENE