Income unequality

Income inequality
Student’s name
Institution

Income inequality
Income equality is one of the skies that receive significant attention from academic activity. High my income rates or gaps is undesirable because it is unhealthy for the growth of an economy of a country. Income tax is one of the various tools used by governments to fix the inequality. The American income taxation system is incremental, which means that a person’s tax is proportional to the income earned. “Marginal tax rate” is the appropriate term for the incremental income tax structure. “Marginal tax rate” is the tax charged on every increase in dollar income. As such, the “marginal tax rate” increases with income. The system intends to promote equality such that the rich (with high income) pay high taxes as the low-economic status households or individuals pay lower taxes. The following table depicts the current marginal tax rates for 2018. An unmarried person requires earnings of $178750 to enter the top quartile (Tax Foundation, 2018).
Rate For Unmarried Individuals, Taxable Income Over For Married Individuals Filing Joint Returns, Taxable Income Over For Heads of Households, Taxable Income Over
10% $0 $0 $0
12% $9,525 $19,050 $13,600
22% $38,700 $77,400 $51,800
24% $82,500 $165,000 $82,500
32% $157,500 $315,000 $157,500
35% $200,000 $400,000 $200,000
37% $500,000 $600,000 $500,000
Table 1. Tax Brackets and Rates, 2018
Taxes can classify under the three main categories tha…