Vertical equity

Tax Glossary Definition

Vertical equity

Vertical equity is a tax principle stating that taxpayers with different levels of income or wealth should be taxed differently, in a way that reflects their ability to pay. Individuals or entities with higher income or greater resources are expected to contribute a larger share of taxes, promoting fairness and progressivity in the tax system.

Example: In a progressive income tax system, a person earning ₹10 lakh per year may pay 30% tax, while another earning ₹3 lakh per year may pay only 10% tax. This difference reflects the principle of vertical equity, where tax liability increases with the taxpayer’s ability to pay.

India's Most Trusted
Pro Tax Filer

Discover why we're one of India's most trusted Pro Tax Filers, built on a foundation of accuracy and reliability.

  • We ensure maximum tax benefits.

  • Taxes? Handled by our CAs and experts.

  • Reliable, year-round tax support at no cost.

  • Satisfaction or your money back came twice.

Start Filing

Scan the QR code to Download the app

Mobile App Available on:

DOWNLOAD For IPHONE

TaxFilr App

DOWNLOAD For Android

TaxFilr App

Have Questions? Let’s Talk!

Chat With Us

Scan to chat

Scan QR Code

OR
Start Chat
Mobile Apps Available On
This feature is available on our mobile app. Get the app now to access this feature!

DOWNLOAD For IPHONE

TaxFilr App

DOWNLOAD For Android

TaxFilr App