If George earned $50,000 and was taxed $7,500, while Julia earned $80,000 and was taxed $9,000, what type of income tax structure exists in their country?

A.not clear due to missing information

B.proportional income tax

C.progressive income tax

D.regressive income tax

Respuesta :

D. Regressive Income Tax

Answer: The correct answer is choice d - regressive income tax.

Explanation: This is an example of a regressive income tax. A regressive tax is one that takes a higher percentage of tax on low income earners than on higher income earners.

George is paying 15% interest on earnings of $50,000 (7,500 / 50,000 = .15). Julia is paying 11.25% on earnings of $80,000 (9,000 / 80,000 = .1125).

Because George is paying a higher percentage of tax on a lower income this is classified as a regressive tax.