Which of the following statements is not correct?
A)A gasoline tax can be an example of a tax that uses the benefits principle.
B)A progressive tax attempts to achieve vertical equity.
C)A progressive tax can be an example of the ability-to-pay principle.
D)A regressive tax attempts to achieve vertical equity.

Question

Quizplus · Accepted Answer

A regressive tax is a tax where the tax rate decreases as the taxable base increases, so it does not attempt to achieve vertical equity. In fact, it can make the tax system less equitable if low-income individuals end up paying a higher percentage of their income in taxes than high-income individuals.

Which of the Following Statements Is Not Correct