Task A2.1 Types of taxes: income tax

Step 1 of 2

The task is based on an example of a progressive tax structure. The table shows the amount of tax paid by four taxpayers who have different levels of income.

 

Taxpayer A

Taxpayer B

Taxpayer C

Taxpayer D

Taxable income ($)

10,000

35,000

50,000

95,000

Income tax (tax paid to nearest dollar)

0

3,192

7,797

23,097

Tax as percentage of taxable income

NA

9.1%

15.6%

24.3%

Look at the table or charts; What happens to the rate or proportion of tax paid as a person earns a higher income?

The proportion stays the same.

The proportion decreases.

The proportion increases.

  • Fact 9

    The Australian Taxation Office started as the Commissioner of Land Tax in 1910 with a dozen employees. It was based in the Department of Treasury, situated in Melbourne, which was the seat of the Commonwealth Parliament until 1927.

Bonds

A medium to long-term investment issued by governments and companies that pay the holder a regular and fixed interest rate for the term of the investment.

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