Title: Regressive tax - Wikipedia
Headings: Regressive tax
Regressive tax
Contents
Examples
See also
Notes
External links

Content: The regressivity of a particular tax can also factor the propensity of the taxpayers to engage in the taxed activity relative to their resources (the demographics of the tax base). In other words, if the activity being taxed is more likely to be carried out by the poor and less likely to be carried out by the rich, the tax may be considered regressive. To measure the effect, the income elasticity of the good being taxed as well as the income effect on consumption must be considered. The measure can be applied to individual taxes or to a tax system as a whole; a year, multi-year, or lifetime. The opposite of a regressive tax is a progressive tax, in which the average tax rate increases as the amount subject to taxation rises In between is a flat or proportional tax, where the tax rate is fixed as the amount subject to taxation increases. Contents
1 Examples
2 See also
3 Notes
4 External links
Examples
Poll taxes
Lump-sum tax
A tax with a cap, above which no taxes are paid. So-called " sin taxes " ( pigovian taxes) have also been criticized for being regressive, as they are often consumed more (or at least at a greater proportion) by the lower classes. Such taxes are often imposed at a flat rate so they will make up a greater proportion of the final price of cheaper brands, compared to the higher-quality products generally consumed by the wealthy. For example, "people in the bottom income quintile spend a 78% larger share of their income on alcohol taxes than people in the top quintile."