Question

Which of the following taxes uses a proportional tax rate structure?

Multiple choice question.

Federal estate tax


Social security tax


State sales tax


Federal individual income tax

Answer 1

The tax that uses a proportional tax rate structure among the options provided is the **Social Security tax**.

Here’s a brief overview of each option:

- **Federal estate tax**: This is a progressive tax, meaning the rate increases as the value of the estate increases.
- **Social Security tax**: This is a proportional tax, as it is a flat rate applied to wages up to a certain limit.
- **State sales tax**: Typically considered regressive, as it is a flat rate applied to purchases regardless of income, but it may vary by state.
- **Federal individual income tax**: This is a progressive tax, with rates that increase with higher income levels.

Therefore, the correct answer is **Social Security tax**.