Money matters
Quantitative Finance
Level
2
Which type of taxation should the government follow if it wants to reduce the income inequalities upto any extent in the society?
Note :- Degressive taxation and digressive taxation are different.
Check out the set Quantitative Finance questions
Degressive Taxation
Digressive Taxation
Regressive Taxation
Progressive Taxation
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1 solution
Progressive taxation is the taxation system in which more taxes are paid by the people with more income and less taxes by the less income people. In other words, the rate of tax is directly proportional to the income. So, money flow is decreased to some extent in the hands of the rich and it favourably affects the other people due to which income distribution becomes equitable to some extent.