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Tee difference between a progressive and a regressive tax is that a progressive tax is a direct form of taxation where the rate of taxing increases as income increases, whereas a regressive tax is an indirect tax where the rate of taxing decrecreases as income increases.
1 A regressive tax is a tax where lower-income entities pay a higher fraction of their income in taxes than do higher-income entities. ( 2 Regressive taxes can also be thought of as taxes where the marginal tax rate is less than the average tax rate.