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progressive tax

A Dictionary of Business and Management | 2006 | © A Dictionary of Business and Management 2006, originally published by Oxford University Press 2006. (Hide copyright information) Copyright

progressive tax A tax in which the rate of tax increases with increases in the tax base. In the UK, the most obvious such tax is income tax but progressive rates are also applied to National Insurance contributions, inheritance tax, and to a limited extent corporation tax. Such taxes are generally justified on the ability-to-pay principle. Compare flat tax; regressive tax.

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