Read the paragraph under the heading ‘Direct Taxes' and answer the following: Why do high-income earners pay more tax?

High-income earners have to pay more of direct taxes- income tax and corporation taxes. Direct taxes are those types of taxes which cannot be transferred to others and has to be paid by the individual directly. It can be an income tax or corporation tax. Corporation tax is the tax incurred on profits made by a business organisation excluding its expenses. This increases as the rate of profit increases. Higher income earners would be required to pay more taxes. Same is the case of income tax which is charged against the income of a person. People with higher income would be required to pay more taxes. Since they are incurring more income, they have the ability to pay more taxes. Thus the rich are taxed more and the poor taxed less.