LearningTransformsv1

Progressive tax rates change after-tax income distribution

Higher portions of income face higher marginal rates.

Output

After-tax incomes with a narrower proportional spread than before tax

Input

Households with different taxable incomes under a progressive schedule

Input

Households with different taxable incomes under a progressive schedule

After-tax incomes with a narrower proportional spread than before tax

Relationship

Tax is calculated in brackets, so higher incomes pay a larger share on upper portions rather than one rate on every unit.

www.oecd.org: Progressive tax rates change after-tax income distributionwww.oecd.org