CLEP US Government

Answer: B - A regressive tax is a tax where people who make less money pay a higher percentage of their income. In a regressive tax, someone who makes $500,000 would pay a lower percentage of their income than someone who makes $50,000. The less you make, the higher your tax rate is. Although there is some debate about this, most economists argue that a sales tax is regressive. Because rich people don’t have to spend as high of a percentage of their income for basic necessities, it could be said that they have a lower sales tax rate-a smaller percentage of their income goes to pay sales taxes than people who have a lower income.