With a lump-sum tax,the average tax rate for high income taxpayers will be
A)the same as the average tax rate for low income taxpayers.
B)lower than the average tax rate for low income taxpayers.
C)higher than the average tax rate for high income taxpayers.
D)Any of the above could be true under a regressive tax system.

Question

Quizplus · Accepted Answer

A lump-sum tax is a fixed amount paid by all taxpayers, regardless of income. Therefore, the average tax rate (tax paid as a percentage of income) will be lower for high-income taxpayers compared to low-income taxpayers, as the fixed tax represents a smaller proportion of their income.

With a Lump-Sum Tax,the Average Tax Rate for High Income