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Browse: Home / MONEY / Taxes

What is the main theory behind Regressive taxation?

Auzy–Conservative: What is the main theory behind Regressive taxation?
What is the main theory behind having a regressive tax as opposed to a progressive tax as it burdens people who are already struggling with the mortgage/rent, utilities and food costs while not making a lot of money for the state as most money from tax is from rich people, while progressive taxation lifts some of the burden of low income earners and will generate more revenue for the state by taxing the higher income earners a bit more.

Answers and Views:

Answer by truecockney
I suppose the main thought behind a regressive tax is to allow the higher earners to have more funds available to create wealth for others through employment. There isn’t ever any guarantee though that these “freer” funds would be pumped back into the economy.

Also, with that how will people become a higher earner and have the money available to create wealth?

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