Higher incomes bear a heavier burden under the regressive taxation system than do lower incomes.
If the tax rate decreases as the amount subject to taxation increases, the tax is considered to be regressive. Regressive refers to a rate's development from high to low, making the average tax rate greater than the marginal tax rate, when expressing a distributional impact on income or spending. An inverse relationship exists between the tax rate and the taxpayer's capacity to pay, as indicated by assets, consumption, or income, which results in a higher burden (compared to resources) being placed on the poor than the rich. These taxes gradually shift the relative burden from those with a higher ability to pay to those with a lesser ability to pay, which tends to lessen the burden placed on people with more financial means.
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