Progressive Tax: A progressive tax is a type of tax where the rate increases as the taxable amount increases. For example, an income tax system where higher earners pay a higher percentage of their income in taxes.
Regressive Tax: A regressive tax is a type of tax where the rate decreases as the taxable amount increases. It means that lower-income individuals end up paying a larger proportion of their income in taxes compared to higher-income individuals.
Proportional Tax: A proportional tax, also known as a flat tax, is a type of tax where everyone pays the same percentage regardless of their income level. It means that both low-income and high-income individuals pay an equal proportion of their earnings in taxes.