Multiple choice

Which of the following is not the method to reduce inequality?

  1. Imposing heavy duty on the rich and low duty on the poor

  2. Imposing heavy taxes on luxury items

  3. Giving tax concessions on essential goods

  4. Imposing equal rates of taxes on the rich as well as the poor
Reveal answer Fill a bubble to check yourself
D Correct answer
Explanation

It is not a method of reducing inequality. If the equal rates of taxes are imposed on the rich as well as the poor, the burden of tax will be more on the poor as they earn less. On the other hand, the rich will not pay more and hence they will become richer and the gap between the haves and have-nots will not decrease.

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