Question

The country of Anteaterland has an income tax rate of 4% that applies to all income received. The country of Petertopia, meanwhile, has a tax rate of 2% on the first $20,000 in taxable income, 4% on the next $20,000 in taxable income, and 6% on all taxable income above $40,000. The country of Zotlandia collects taxes in the amount of $5,000 from each of its citizens regardless of his or her income.

Anteaterland has a ["regressive", "proportional", "progressive"] income tax system. Petertopia has a ["regressive", "proportional", "progressive"] income tax system. Zotlandia has a ["regressive", "proportional", "progressive"] income tax system.

Answer 1

Anteaterland has a 'PROPORTIONAL' income tax system. A proportional tax system is the one in which tax rate is fixed regardless of the tax base. It means that it doesn't increase or decrease with the increase or decrease in income.

Petertopia has a 'PROGRESSIVE' income tax system. In such a system tax rate varies with taxable income. In Other words, in such a system lower tax is taken from lower income groups and higher tax is imposed on higher income groups for the purpose of equality.

Zotlandia has a 'PROPORTIONAL' income tax system. Same amount of tax is collected from everyone regardless of the income.