[This is part of the series: The Complete Guide To Economics 101.]
What is a regressive tax?
A Regressive Tax is a tax that’s rate decreases as one’s income increases.
Earnings from zero to 50,000 are taxed at (say) 30%.
Earnings from 50,000 to 100,000 are taxed at 20%.
And earnings from 100,000 and above are taxed at 10%.
Although it rewards success, a progressive tax is irrational to most because it penalizes lower incomes.
This is the opposite of a progressive tax.