With reference to Figure 1 and your own knowledge, explain the distinction between a progressive and a regressive tax.
Figure 1: Proportion of income spent on major taxes across different household income bands
| Income Band (Annual Income) | National Income Levy paid (as a % of income) | Fuel Excise Tax paid (as a % of income) |
|---|---|---|
| Low Income (€15,000) | 5% | 12% |
| Middle Income (€48,000) | 18% | 6% |
| High Income (€125,000) | 35% | 2% |
