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      Question

      Which one of the following term is used when the tax

      rate increase with increase in the level of income and vice versa?
      A Proportional taxation Correct Answer Incorrect Answer
      B Digressive taxation Correct Answer Incorrect Answer
      C Regressive taxation Correct Answer Incorrect Answer
      D Progressive taxation Correct Answer Incorrect Answer

      Solution

      In a progressive tax system, the tax rate is designed to increase as the income level of an individual or entity increases. This means that individuals with higher incomes will pay a higher proportion of their income in taxes compared to those with lower incomes.

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