A family with an income of $25,000 pays taxes of $3,000 per year and a family with an income of $50,000 pays taxes of $4,000 per year.The tax plan is:

A) regressive.
B) proportional for all income levels.
C) progressive.
D) based on the ability-to-pay principle.
E) proportional for income levels between $25,000 and $50,000.

Regressive Tax

A tax levied in a way where the rate of taxation diminishes as the taxable amount gets larger.

Proportional Tax

A taxation system where the tax rate remains constant regardless of the amount subject to tax.

Progressive Tax

A tax system where the tax rate increases as the taxable amount or income rises, meaning higher earners pay a larger percentage of their income in taxes than lower earners.