Theme 3: Fairness in TaxesLesson 3: Progressive Taxes
A progressive tax takes a larger percentage of income from high-income groups than from low-income groups and is based on the concept of ability to pay. A progressive tax system might, for example, tax low-income taxpayers at 10 percent, middle-income taxpayers at 15 percent and high-income taxpayers at 30 percent. The U.S. federal income tax is based on the progressive tax system.
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materials:
Activities
 Activity 1: Progressive Taxes and You Show what percentage of each person's income would go towards tax in a progressive system by completing pie graphs. Activity 2: Comparing U.S. and Swedish Tax Rates Find out how tax rates in Sweden compare with those in the United States. Activity 3: How Much Will You Earn? Research your future career to discover your earning potential. Assessment
 Complete the assessment page to test your understanding of Progressive Taxes. Links
 Visit Directory of Tax Sites for Other Countries to explore a directory of tax sites for countries from Albania to Zimbabwe. Some of your findings may really surprise you! |
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How does a progressive tax help equalize the wealth of a country?
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Did You Know?
In 1913, Congress levied a one percent tax on net personal incomes above $3,000, with a six percent surtax on incomes above $500,000. As the nation sought greater revenue to finance the World War I effort, the top rate of the income tax rose considerably.
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