Multiple choice

If the tax rate increases with the higher level of income, it shall be called

  1. proportional tax

  2. progressive tax

  3. lump sum tax

  4. regressive tax

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

A progressive tax is one where the tax rate increases as the taxable amount increases. This means those with higher incomes pay a higher percentage of their income in taxes.