Which policy is associated with reducing inequality?

• A. Progressive income tax and high estate/gift taxes
• B. Flat tax rate for all
• C. No government redistribution
• D. Only education vouchers

Answer: (A)

Reducing inequality is most directly addressed by policies that redistribute income and wealth. A progressive income tax raises higher rates on larger incomes, which narrows the after-tax income spread and provides revenue for programs that assist lower-income households. Estate and gift taxes help prevent wealth from concentrating across generations, keeping top-end wealth from widening the gap over time. Together, these tools reduce overall inequality and fund public services that improve opportunities for those with less. In contrast, a flat tax applies the same rate to everyone, which tends to leave after-tax differences largely unchanged; no redistribution leaves gaps intact; and education vouchers, while they can improve access for some, don’t systematically reduce inequality without broader redistribution.