A country redesigned its tax policy so that the tax rate was reduced for individuals earning larger amounts of money. For exampl
e, a household making $50,000 a year would pay 23 percent in taxes while a household making $200,000 would pay 23 percent taxes only on the first $150,000 of their income and no taxes on the income above $150,000. This is called A. liberal taxation. B. regressive taxation. C. conservative taxation. D. progressive taxation.
Regressive taxation is a form of taxation where people who earn higher income pay a less percentage of income as tax while those who earn less income pay a higher percentage of income as tax.
Progressive taxation is a form of taxation where people who earn higher income pay a higher percentage of income as tax and those who earn less income pay a lower percentage of income as tax.
This is known as <u>market penetration-</u> instead of expanding his market to new customers or products he is doing a deeper development of the customers he already has to increase loyalty and sales.
