Exit Re Question 68 of 80 Which of the following is most likely to create a more
ID: 1116989 • Letter: E
Question
Exit Re Question 68 of 80 Which of the following is most likely to create a more equal distribution of income? A 6% national sales tax on all goods and services O A regressive income tax without income transfers OAproportional income tac accompanied by a tax rebate for people with high incom es Aprogressive income tax accompanied by income transfers to people with low incomes O Replacement of the income tax with a property tax Answer the question above by clicking on the correct response. ScrLk Pause Insert F8 F11 12Explanation / Answer
Correct option is (4).
A progressive income tax leads to higher marginal and average tax rates as taxable income increases. If the increase in tax such collected is redistributed, income equality is likely to increase.