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Ability-to-Pay Principle

Fundset Deutsch2Chinese(S)

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Leistungsfähigkeitsprinzip
[das] 能力纳税原则
Ability-to-pay principle
 
Zahlungsfähigkeitsprinzip
[das] 能力纳税原则
Ability-to-pay principle

Environmental Economics Glossary

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Ability-to-Pay Principle
A principle of taxation in which taxes are based on the income or resource-ownership ability of people to pay the tax. The income tax is one of the most common taxes that seeks to abide by the ability-to-pay principle. In theory, the income tax system is set up such that people with greater incomes pay more taxes. Proportional and progressive taxes follow this ability-to-pay principle, while regressive taxes, such as sales taxes and Social Security taxes, don't. The logic behind the ability-to-pay principle is that taxes are collected by the government to finance public goods that provide benefits to all members of society. And because taxes are a diversion of resources from the household to the government sector, it makes sense to tax, or divert income away from, the people who actually have the income.