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JAMB Economics 1978 Question 18

Question 18

Public Finance

Tax which takes a higher percentage from higher incomes is called

  1. A.a regressive tax
  2. B.a progressive tax
  3. C.a proportional tax
  4. D.an indirect tax
  5. E.a direct tax.
Show the answer and explanation

Answer: B (a progressive tax)

Explanation

A progressive tax rate rises as income rises, so higher earners pay a bigger percentage.