Assuming an 8 percent sales tax is leveled on all consumptio

Assuming an 8 percent sales tax is leveled on all consumption, complete the following table: Instructions: Enter your responses rounded to the nearest whole number and whole %b) Is the sales tax progressive or regressive Regressive Progressive

Solution

(b) Sales tax is a Regressive tax. ( Explanation: A regressive tax is a tax that takes a smaller proportion of a income as income rises.)

Income($)	Consumption($)	Sales Tax($)	% of income paid on Taxes
10000	11000	880	8.8%
20000	20000	1600	8%
40000	36000	2880	7.2%
80000	60000	4800	6%