A government levies income tax on individuals. The first $100 000 of earned income is taxed at 20%, while any earned income above $100 000 is taxed at a marginal rate of 50%. Which statement is not valid?
- AThe average income tax rate is 20% at an income of $80 000 and 35% at an income of $200 000.
- BThe tax is a direct tax for incomes above $100 000.
- CThe tax is a proportional tax for incomes between $20 000 and $40 000.
- DThe tax is regressive when incomes change from below to above $100 000.