Regressive elements burden low incomes more proportionally

Steps:

• Define regressive: A tax or system where lower-income groups pay a higher proportion of income than higher-income groups.
• Evaluate options: Check if each imposes fixed costs (regressive for taxes) or aids low incomes more (progressive for benefits).
• Identify fixed-amount taxes: These hit low earners harder as a share of income.
• Confirm via examples: Excise taxes like on luxuries are classic regressive cases.

Why B is correct:

• Specific (excise) taxes on beer and tobacco are fixed per unit, taking a larger income share from low earners, per economic definitions of regressivity.

Why the others are wrong:

• A: Rent subsidies reduce housing costs more for low-income tenants, making them progressive.
• C: Child benefits provide flat payments that disproportionately aid lower-income families, progressive.
• D: Capital gains tax applies mainly to high earners with investment income, progressive in structure.

Final answer: B