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A flat tax is a tax with a single rate on the taxable amount, after accounting for any deductions or exemptions from the tax base. It is not necessarily a fully proportional tax. Implementations are often progressive due to exemptions, or regressive in case of a maximum taxable amount. There are various tax systems that are labeled "flat tax" even though they are significantly different. The defining characteristic is the existence of only one tax rate other than zero, as opposed to multiple non-zero rates that vary depending on the amount subject to taxation.
An environmental tax, ecotax, or green tax is a tax levied on activities which are considered to be harmful to the environment and is intended to promote environmentally friendly activities via economic incentives. A notable example is carbon tax. Such a policy can complement or avert the need for regulatory approaches. Often, an ecotax policy proposal may attempt to maintain overall tax revenue by proportionately reducing other taxes ; such proposals are known as a green tax shift towards ecological taxation. Ecotaxes address the failure of free markets to consider environmental impacts.
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A progressive tax is a tax in which the tax rate increases as the taxable amount increases. The term progressive refers to the way the tax rate progresses from low to high, with the result that a taxpayer's average tax rate is less than the person's marginal tax rate. The term can be applied to individual taxes or to a tax system as a whole. Progressive taxes are imposed in an attempt to reduce the tax incidence of people with a lower ability to pay, as such taxes shift the incidence increasingly to those with a higher ability-to-pay. The opposite of a progressive tax is a regressive tax, such as a sales tax, where the poor pay a larger proportion of their income compared to the rich.
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The alternative minimum tax (AMT) is a tax imposed by the United States federal government in addition to the regular income tax for certain individuals, estates, and trusts. As of tax year 2018, the AMT raises about $5.2 billion, or 0.4% of all federal income tax revenue, affecting 0.1% of taxpayers, mostly in the upper income ranges.
Income inequality in the Philippines is the extent to which income, most commonly measured by household or individual, is distributed in an uneven manner in the Philippines.
In general, the United States federal income tax is progressive, as rates of tax generally increase as taxable income increases, at least with respect to individuals that earn wage income. As a group, the lowest earning workers, especially those with dependents, pay no income taxes and may actually receive a small subsidy from the federal government.
Tax policy and economic inequality in the United States discusses how tax policy affects the distribution of income and wealth in the United States. Income inequality can be measured before- and after-tax; this article focuses on the after-tax aspects. Income tax rates applied to various income levels and tax expenditures primarily drive how market results are redistributed to impact the after-tax inequality. After-tax inequality has risen in the United States markedly since 1980, following a more egalitarian period following World War II.
References
- 1 2 Suits, Daniel B. (1977). "Measurement of Tax Progressivity". American Economic Review . 67 (4): 747–752. JSTOR 1813408.
- ↑ B.N., Mandal (1 Jan 2009). Global Encyclopaedia of Welfare Economics. Global Vision Publishing Ho. p. 282. ISBN 9788182202597 . Retrieved December 5, 2013.
- ↑ "Confidence Intervals for the Suits Index" (PDF). National Tax Journal. March 2003. Archived from the original (PDF) on 2007-09-27. Retrieved 2007-05-16.
- ↑ Distributive impacts of alternative tax structures. The case of Uruguay, Retrieved December 5, 2013
- ↑ "Tax Fairness Declining in Minnesota: Explaining the 2007 Tax Incidence Study". Minnesota Budget Project. April 2007. Archived from the original on 2016-08-07. Retrieved 2023-03-24.
- ↑ "Who Pays Texas Taxes?" (PDF). Center for Public Policy Priorities. 2007-03-20. Retrieved 2023-03-24.