Advanced English Dialogue for Business – Progressive tax system

Listen to a Business English Dialogue About Progressive tax system

Mariah: Hi Danielle, do you know what a progressive tax system is in business and finance?

Danielle: Yes, I think it’s a tax system where the tax rate increases as a person’s income or wealth increases.

Mariah: That’s correct. In a progressive tax system, higher-income individuals are taxed at higher rates, while lower-income individuals are taxed at lower rates.

Danielle: How does a progressive tax system aim to achieve fairness?

Mariah: It aims to distribute the tax burden more equitably by placing a greater burden on those who can afford to pay more taxes.

Danielle: Are there different tax brackets in a progressive tax system?

Mariah: Yes, typically there are multiple tax brackets, with each bracket corresponding to a different range of income and a different tax rate.

Danielle: How do tax rates vary across different income levels?

Mariah: Tax rates are usually structured so that lower-income individuals pay lower tax rates, while higher-income individuals pay higher tax rates.

Danielle: Does everyone pay the same tax rate within a tax bracket?

Mariah: No, within each tax bracket, individuals pay the same rate on the portion of their income that falls within that bracket.

Danielle: What’s the purpose of having a progressive tax system?

Mariah: The main purpose is to promote income equality and provide support for social welfare programs funded by tax revenue.

Danielle: Thanks for explaining, Mariah. The progressive tax system seems like an important tool for promoting fairness in taxation.

Mariah: No problem, Danielle. It’s a key aspect of tax policy aimed at reducing income inequality and supporting social programs.