Question

1. A poll tax is a tax where everyone pays the same absolute amount to the government. Is it progressive, regressive, or distributionally neutral?
2. A basic income is a benefit where everyone receives the same absolute amount from the government. Is it progressive, regressive, or distributionally neutral?
3. Suppose you learn that the richest 10% of people pay 30% of income tax. Does it mean that the tax system is progressive?
4. Some governments of developing countries give scholarships for some of their best students to go to graduate school abroad. If there are no eligibility restrictions, is this policy likely to be progressive or regressive? What might justify this policy?

Answer 1

1) When all people pays the same absolute amount to the government it is regressive because it causes the low-income earners to pay a higher amount of their incomes in taxes in comparison to the high-income earners. The average tax rate will be higher than the marginal tax rate.
2) When all recieves the same absolute amount from the government it is distributionally neutral because the rate is fixed irrespective of high, middle and low-income earners
3) When richest 10% of people pay 30% of income tax it will be a progressive tax because the taxation rate increases as the payer's income increases. The progressive taxes increase when the income of a person increases thus helps control spending and acts as automatic stabilizers. The average tax rate will be lower than the marginal tax rate.
As per policy w have to answer first question, I have answered more than it