Legal Definitions - graduated tax

A graduated tax is a type of tax where the rate of taxation increases as the income or value being taxed increases. This means that people who earn more or have more valuable property will pay a higher percentage of their income or property value in taxes than those who earn less or have less valuable property.

For example, in a country with a graduated income tax, someone who earns $50,000 per year might pay a tax rate of 20%, while someone who earns $100,000 per year might pay a tax rate of 30%. This is because the graduated tax system is designed to be more fair, as it places a greater burden on those who can afford to pay more.

Another example of a graduated tax is an estate tax, which is a tax on the value of a deceased person's estate. In a graduated estate tax system, the tax rate increases as the value of the estate increases. This means that people with larger estates will pay a higher percentage of their estate value in taxes than those with smaller estates.