Question No 2: (10 Marks) The tax structure of an economy depends on its tax base, tax rate, and how the tax rate varies. The tax base is the amount to which a tax rate is applied. The tax rate is the percentage of the tax base that must be paid in taxes. To calculate most taxes, it is necessary to know the tax base and the tax rate. Proportional taxes (flat-rate taxes) apply the same tax rate to any income level, or for any size tax base. A regressive tax is higher at lower incomes. A progressive tax applies a higher tax rate to higher incomes. The annual income of three different tax payers are Ms. Rahma, Ms. Sumaya, and Ms. Sheika are OMR 3,000, OMR 15,000 and OMR 30,000 respectively. Assuming that Ms.Rahma wants to pay taxes of R0600, RO300, and RO600 under Flat tax, Progressive tax and Regressive tax respectively. Whereas Ms.Sumaya wants to pay RO3,000, RO3,000 and RO600 under Flat tax, Progressive tax and Regressive tax respectively. Ms. Sheika wants to pay RO 6,000, RO 9,000 and RO600 under Flat tax, Progressive tax and Regressive tax respectively. Required: a) How would you assess the rate of tax (%) in each tax payer under Flat tax, Progressive tax and Regressive tax? (3 Marks) b) Do you think that the above tax structure is uniform and fair to all? Write your comments clearly on each of the tax structure in your own words using the above scenario? Excise taxes on tobacco, alcohol and state sales taxes are often criticized for being regressive. Although everyone pays the same rate regardless of income, why might this be so? Justify your answer clearly, (7 Marks)