Apr 21 2012

Regressive tax

Published by at 8:18 pm under

A tax that places a smaller burden on the incomes of the rich than it does the poor. For example a sales tax that adds $1000 to the price of a product (say a 10% tax on a $10,000 car) places a larger burden on someone earning $50,000 (2% of his income) than someone earning $100,000 (1% of his income). A sales tax is therefore a regressive tax.

About the author:  Jason Welker teaches International Baccalaureate and Advanced Placement Economics at Zurich International School in Switzerland. In addition to publishing various online resources for economics students and teachers, Jason developed the online version of the Economics course for the IB and is has authored two Economics textbooks: Pearson Baccalaureate’s Economics for the IB Diploma and REA’s AP Macroeconomics Crash Course. Jason is a native of the Pacific Northwest of the United States, and is a passionate adventurer, who considers himself a skier / mountain biker who teaches Economics in his free time. He and his wife keep a ski chalet in the mountains of Northern Idaho, which now that they live in the Swiss Alps gets far too little use. Read more posts by this author

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