When taxable income on a progressive basis exceeds certain thresholds
A)a higher rate of tax is charged on all levels.
B)tax credits become more important.
C)deductions reach a maximum allowable amount.
D)the tax rate is increased until a new income level is exceeded.

Question

Quizplus · Accepted Answer

When taxable income on a progressive basis exceeds certain thresholds, the tax rate is increased until a new income level is exceeded. This means that as the income increases, a higher percentage of tax is charged on the increased income above the threshold. This is the basic concept of a progressive tax system.

When Taxable Income on a Progressive Basis Exceeds Certain Thresholds