Question

Compare a progressive income tax with a corporate tax under the 6 criteria of a good tax. Explain the changes in the recent tax bill as well.

Answer 1

A corporate tax is a direct tax imposed by a jurisdiction on the income or capital of corporations or analogous legal entities. Contrary to it Income tax levied directly on personal income that is one type of progressive tax also.

Corporate tax rates generally are the same for differing types of income while in income tax, rate may increase as taxable income increases (referred to as graduated or progressive rates).

The tax imposed on companies is usually known as corporate tax and is levied at a flat rate while income tax is levied on individual generally.

Taxable income of taxpayers resident in the jurisdiction is generally total income less income producing expenses and other deductions while  Income of a corporation's shareholders usually includes distributions of profits from the corporation.

.Income tax is  not levied on private ltd. companies or we can say that it is same as corporate tax but used in case of individual.