Econs Essay Inequity
Q1.
When the income distribution gets very skewed, with a small number of people getting a large portion of the income, the taxation system can be used to redistribute some of the income so that the poor aren’t as poor and the rich aren’t as rich.
Taxes can be used to redistribute some income to the poor. The government can use a progressive income tax.
The definition of progressive tax is the taxing mechanism in which the taxing authority charges more taxes as the income of the taxpayer increases. A higher tax is collected from the taxpayers who earn more and lower taxes from taxpayers earning less.
Therefore, the poor keep a larger percentage of their income than the rich do. Those taxes are then used to fund social welfare programs that are used primarily by individuals who earn less.
It also gives the government more revenue while also enhancing opportunity for its lower and middle class citizens. all wealth being concentrated in the hands of a few people.
As income increases, households have more and more income that is not spent on basic necessities and thus can afford to pay more tax in a way that is impossible for the poor.
The system would become equitable and that progressive taxation can and should be used to redistribute income within society so that the final distribution is more equal than the original one
Calculated by gini coefficient and Lorenz curve.
Q2.
Definition of flat tax:
A system that applies the same tax rate to every taxpayer regardless of income bracket. A flat tax applies the same tax rate to all taxpayers, with no deductions or exemptions allowed. Supporters of a flat tax system propose that it would give taxpayers incentive to earn more because they would not be penalized with a higher tax bracket. In addition, supporters argue that a flat tax system is fairer because it imposed the tax on all taxpayers regardless of income.
Definition of flat citizen’s income: is a form of social security system[2] in which all citizens or
When the income distribution gets very skewed, with a small number of people getting a large portion of the income, the taxation system can be used to redistribute some of the income so that the poor aren’t as poor and the rich aren’t as rich.
Taxes can be used to redistribute some income to the poor. The government can use a progressive income tax.
The definition of progressive tax is the taxing mechanism in which the taxing authority charges more taxes as the income of the taxpayer increases. A higher tax is collected from the taxpayers who earn more and lower taxes from taxpayers earning less.
Therefore, the poor keep a larger percentage of their income than the rich do. Those taxes are then used to fund social welfare programs that are used primarily by individuals who earn less.
It also gives the government more revenue while also enhancing opportunity for its lower and middle class citizens. all wealth being concentrated in the hands of a few people.
As income increases, households have more and more income that is not spent on basic necessities and thus can afford to pay more tax in a way that is impossible for the poor.
The system would become equitable and that progressive taxation can and should be used to redistribute income within society so that the final distribution is more equal than the original one
Calculated by gini coefficient and Lorenz curve.
Q2.
Definition of flat tax:
A system that applies the same tax rate to every taxpayer regardless of income bracket. A flat tax applies the same tax rate to all taxpayers, with no deductions or exemptions allowed. Supporters of a flat tax system propose that it would give taxpayers incentive to earn more because they would not be penalized with a higher tax bracket. In addition, supporters argue that a flat tax system is fairer because it imposed the tax on all taxpayers regardless of income.
Definition of flat citizen’s income: is a form of social security system[2] in which all citizens or