lump-sum tax


A fixed amount of taxes assessed equally on all taxpaying entities regardless of their income level. Lump-sum taxes, such as sales taxes, property taxes on cars and business equipment, and excise taxes, are thought to be regressive since lower income people must apply a higher percentage of their income to the tax. In theory, a lump sum income tax system could be more efficient because it wouldn't be predicated on the ability to pay or a person's willingness to work.

Use lump-sum tax in a sentence

It was a lump-sum tax and that was good for everyone because it meant that everyone would be assessed equally.

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Sometimes, when making large retail purchases, I travel to Delaware to avoid the lump-sum tax that most states have on such purchases.

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We crunched the numbers on the lump-sum tax and were less than thrilled with the outcome, so my partner wanted to trim expenses elsewhere to make up the difference.

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