Question 1:
Which kind of tax rate do you think the Government should adopt?
- Flat Tax Rate
- Progressive Tax Rate
Note: Before 2011, the property tax rate for owner-occupied homes was at a flat tax rate of \(4\%\). Now, the property tax rate is a progressive one (first $6,000 @ \(0\%\), next $59,000 @ \(4\%\) and exceeding $65,000 @ \(6\%\)); i.e. the tax rate varies depending on the annual value of the home. The individual income tax rate is also a progressive rate.
Question 2:
Most Government set their individual income tax rate lesser than \(33\%\).
(Refer to Taxes Around the World.)
Can you suggest reasons why most Government do not set their individual income tax rate at \(33\%\) (the peak of the hump), as suggested in the video? Why do they set it to be lesser than \(33\%\)?
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