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Unformatted text preview: tax o progressive tax: % of income paid in tax as income o proportional tax: % of inc. paid in tax is constant o regressive tax: % of inc. paid in tax as inc. o Individual income tax- labor inc. + capital inc. Michigan: exemption $3400/person Not taxed Tax rate=0 Then flat rate of 4.35% on all taxable inc. above exemption Somewhat progressive over much of income range, because of exemption Federal +many states + other countries income tax o Exemption o graduate marginal tax rates mtr as income payroll tax- on labor earnings no exemptions o flat 15.3% up to ceiling ($102, 000) o 2.9% above ceiling...
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