The authors of the two passages would be most likely to disagree over whether

Manvir on December 3, 2019

Why is D wrong?

In line 14, passage A makes it seem like the high income earners pay a share of their entire incomes In line 27-38, it makes it seem that they only put tax on portion of income So don't they disagree about how much is being taxed under the progressive tax?

1 Reply

Ben on December 3, 2019

Hi Manvir, thanks for the question!

I think it is important to understand how a progressive tax system is described in the passage. Let's imagine a hypothetical system in which all income under $100,000 is taxed at 10% and income between $100,000 and $200,000 is taxed at 20%. Someone making $100,000 will be taxed at 10% ($10,000 total), while someone making $200,000 will be taxes at 10% for the first layer and 20% for the second layer (For a total of $30,000).

The overall tax rate on the first earner is 10%, while the overall tax rate on the second earner is 15%. So in a progressive system, high-income earners still do get taxed at a higher rate over their entire income (effectively), although not at the 20% an uninformed individual may expect.

The two authors do not disagree that high-income earners pay more under a progressive tax system, passage B simply explains that there are layers of higher tax income levels, which is not applied to the person's income as a whole, but each layer will have its respective tax rate.

Let me know if this was clear, and please ask any other questions you may have!