Question

When the government implements programs such as progressive income tax rates, which of the following is likely to occur? a. equality is increased and efficiency is increased. b. equality is increased and efficiency is decreased. c. equality is decreased and efficiency is increased. d. equality is decreased and efficiency is decreased.

Answer 1

Answer:

The correct answer is b. equality is increased and efficiency is decreased.

Explanation:

Progressive taxes are considered those in which the economic capacity of the person or the company is taken into account, that is: the higher the economic capacity the value to be paid for the tax increases. The objective of this type of taxes is that the payments made by people or companies are made proportionally to their income. Direct taxes are usually progressive.

An example of a progressive tax is the income tax, in the case of natural persons the value to be paid for this concept depends on the taxable liquid income.