Question

Suppose that a person earning $10,000 this year would pay $3,500 in taxes, while a person earning $100,000 would pay $21,000 in taxes. Based solely on this information, it appears that tax rates are...

a. regressive.

b. flat.

c. progressive.

Answer 1

The tax Rate are Progressive.

Tax rate are differ for every income of which every individual earns and pay tax on them. By which every person are responsible for paying tax on their income. Tax slab of each income are different in US.

Progressive defines that income rises then the increasingly tax are imposed on their income. Income defines that what tax brackets are imposed on them. Their are seven brackets of tax rate like 10%, 15%, 25%, 28%, 33%, 35%, 39.6%.

The income regarding highest slab rate are lastly paid highest tax not exceeding the 39.6%. their is a table given below of tax rate brackets. They are.

Tax rate Single Head of household
10% . Up to $9,325 Up to $13,350
15% $9,326 to $37,950 $13,351 to $50,800
25% $37,951 to $91,900. $50,801 to $131,200
28% $91,901 to $191,650 $131,201 to $212,500
33% . $191,651 to $416,700 $212,501 to $416,700
35% $416,701 to $418,400 $416,701 to $444,550
39.6% $418,401 or more. $444,551 or more

But as per Indian System the tax bracket defines as follows-

Tax Rate Income slab

0%. Upto 2,50,000

05%. 2,50,000 to 5,00,000

10% . 5,00,000 to 10,00,000

20% . above Rs. 10,00,000

This rates are applicable in india for individuals