Vertical equity means that
A)taxpayers with the same amount of income pay the same amount of tax.
B)taxpayers with larger amounts of income should pay more tax than taxpayer's with lower amounts of income.
C)all taxpayers should pay the same tax.
D)none of the above.

Question

Quizplus · Accepted Answer

Vertical equity means that taxpayers with larger amounts of income should pay more tax than taxpayer's with lower amounts of income. This is based on the principle of ability to pay, where those who have more can afford to contribute more to society through taxes. Option A is incorrect because taxpayers with the same amount of income may not have the same ability to pay, such as those with high expenses or dependents. Option C is incorrect because it goes against the principle of ability to pay. Option D is incorrect because there is a clear definition of vertical equity.

Vertical Equity Means That