Progressive Tax

Progressive tax is one kind of taxation. The tax rate increases with individual income or expenditure, referring to the way the rate progresses from low to high, where the average tax rate is less than the marginal tax rate. It can be applied to individual taxes or to a tax system as a whole; a year, multi-year, or lifetime. Progressive taxes attempt to reduce the tax of people with a lower ability to pay, such as low income individual, as it shifts the tax incident increasingly to those with a higher ability to pay.

The opposite of a progressive tax is a regressive tax, where the relative tax rate increases as an individual's ability to pay it decreases. Sales taxes are often criticized because low income households must pay a greater share of their disposable income to a sales tax than wealthier households. Regressive tax shifts the tax incident to those with a lower ability to pay.

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Source: Wikipedia, http://en.wikipedia.org/wiki/Progressive_tax