A simple, low flat tax of 7% would cut nearly everybody's taxes. It would add about (including economic growth associated with it) more than $500 billion to our GDP. It would open up resources in the private market that could be utilized for investments that grow the economy, and improve the standards of living for all Americans. A flat tax creates a broad base, and thus minimizes economic distortions, and makes it truly equal and fair -- we all pay the same percentage of income. A progressive tax creates a bias towards the wealthy, and starts class warfare (me vs the top 1%). Loopholes let many wealthy people pay unfair rates. It may be helpful by distributing the tax burden, but high rates discourage an activity, and high progressive taxes thus discourage wealth creation. Not a good idea.
go to support the distribution of public goods and services. The people who most often benefit from these goods and services are the lower classes, which use benefits such as welfare or public transportation. It only makes sense that if one group of people uses a good/service more often, they are more responsible for supporting it than a group that more sparingly uses the good/service.
Harvard studies show 5 trillion dollars out into our economy from a flat tax
There is no doubt about this. Lately, many nations in Eastern Europe (Russia, Lithuania, and Hungary to name a few) are having great success with their flat tax systems. Opponents like to say that its unfair because there is less taxes on the rich. That is false. If everyone payed a 10% personal income tax, the tax of someone earning $1,000,000 would be higher than of someone earning $10,000. It also eliminates the confusion of a progressive tax system allowing for the government to spend less money.
I believe flat taxes are the best system, because they create a leveled and even playing field for everyone, regardless of their economic tier. Though most believe that the rich should be taxed more, I believe it's unfair and would be a form of discrimination to do so. To tax everyone by the same rate, it would be the most efficient and fair way to do things. Nobody has an advantage, and nobody has a disadvantage either.
Flat taxes take the same percentage of someone's income, above the base, untaxed amount. This is, to me, the most fair method of taxation, burdening neither end of the income spectrum. This type of tax also eliminates many of existing tax loopholes, making it even a more fair method of taxation.
I agree that flat taxes are the best, because they force the government to think about what they spend on. The government gets most of its money from the taxes paid by citizens. Allowing the government to have variable tax rates allows them to spend wastefully, while having a flat tax would force the government to think about spending.
A modified flat tax, one allowing for a generous standard deduction and large dependency deductions, would benefit the working poor and the poor. The rich would pay a higher effective rate than they are now.
A flat tax system would work in America's economy. It is the best way to regain respect from the rich and promote the economy. 1. A progressive tax system is unfair to the rich. If a man makes $30,000, he can pay a lower percentage of tax than the man who makes $300,000. This is unfair, and in a flat tax system, the richer man still pays more, but it is at least proportionate to the man who makes less. 2. A progressive tax system encourages all citizens to pay their responsibility to the government somewhat equally. When those who make low incomes get tax breaks, it is like they don't contribute to the government. The rich already pays so many taxes that it is almost like they are funding the entire government. 3. Taxing the wealthier people at a higher rate is a type of discrimination. It wouldn't be fair to tax African Americans at a higher rate, so why would it be fair to tax the rich at a higher rate? 4. A flat tax would allow the business owners to be able to plan for their business more. If they know that the tax rate would be 15% for the next 10 years, they would be able to financially plan out their income rates and decide how they want to spend their money, thus having less money in the bank because they will know that it will not need to be taxed. Also, more people could be employed since they know the tax rate.
It seems obvious that the flat tax is a viable solution, yet I think it should be a scaled flat tax. Maybe this, by definition, is not a flat tax, but a combination of a scaled tax and flat tax. Make below 30k, pay x, 30k to 60k pay y, 60k to 100k pay z, 100k to 130k pay t, 130 k to 160k pay g, and so on. I think this system would lead employers to see that employees are at the upper level of each scale, potentially increasing the base income, and lowering the tax ratio for the employee in each bracket. In an opposing aspect, the employer portion of the tax could also be reduced as the employee earns more, giving incentive to pay the worker more.
Different people receive different levels of benefit from government. IE: A person with $100,000 savings receives a larger benefit than a person with no savings in a FDIC bank. The benefit is the guarantee by the government to pay any amount up to $100,000 lost due to a bank going under. A private company would never charge the same premium for high and low risks. They charge a higher amount for a higher risk.
A usage tax that equitably taxes based upon the consumption of real benefits offered by the gov is better than a flat tax.
I'd posit that the moral, economic, and liberty arguments run contrary to that position for a few reasons.
MORAL: a) Taxation is coercive theft, which is prima facie immoral. b) In compliance with taxation, you do not own all the fruits of your labor, which means someone else has a higher claim to your income than you, making you somewhat of a slave. Slavery is prima facie immoral.
ECONOMIC: a) Taxation discourages and disrupts production by decreasing the incentive people have to produce (companies lose 100 cents out of every dollar they lose, and are permitted to keep only 65 cents, say, out of every dollar they gain). As a consequence, they do not expand their operations, unless there is minimal risk involved. b) Entrepreneurs have a decreased incentive to take risks with their money to open new businesses, develop new processes, or invest starting capital to risky firms. They instead are discouraged to find new solutions or better ways of doing things because of the decreased risk they are willing to take on due to their decreased income. c) Taxation requires enforcement, bureaucratic administration and distribution. This means that stealing from A to give to B isn't close 100% efficient. This destroys wealth by employing people in unproductive jobs, while simultaneously regretting the production that would otherwise have come about had they been in the private sector. Example: When help is given privately, 70% or more of each charitable dollar gets to a worthy recipient. But only about 30% of each tax welfare dollar reaches the needy.
LIBERTY: a) Having your money stolen from you under pain of living in a cage is not a free, voluntary expression of moral intelligence. It is explicitly someone having control over the extension of your right to bodily autonomy, namely the fruits of your individual production. b) The same thing goes for welfare recipients. They are told where they may live, what they may do, etc to stay within the system of institutionalized underclass creation.
Given what the government is supposed to do (provide justice, defense, etc.), one can say all benefit equally, so flat is the way to go. However, the rich have more to lose, so they should pay more (like an insurance policy). If dollar were to be worthless, or invasion occurred, the poor would be far less effected and more likely to adapt (move or defect).
Flat tax punishes everybody, particularly those with lower income, where even the smallest tax rate equate to a significant amount. Progressive dampens incentive, and is nothing more than the Robin Hood principle, "Take from the rich and give to the poor". Both systems are unfair. Taxation should supplement government income with the funds necessary to run essential functions, not a means of bullying one particular group of people depending on the political party in power. To be fair and practical, taxation must be done in a centralist manner, a one-size-fits-all approach.
So what's the best solution? The linear tax system. Everyone pays their fair share. It's a simple taxation system, based on the formula of a line, that provides a simple means of taxation, providing the government with the money it needs, while taxing everyone at a fair rate - regardless of income source.
How does it work? A line has 2 variables. These variables, in the context of taxation, are:
∙ Slope - The "flat" tax rate.
∙ Offset - The amount of income reduction before applying the slope.
Everything beyond the offset is taxed at the rate of the slope. The offset allows for things such as "exemptions" and "credits".
"Exemptions"... Allowances to survive, based on a minimum cost-of-living for each person for which a taxpayer is responsible, such as the taxpayer and any dependents.
"Credits"... These are expenses that help promote economic growth and a better society that can reduce taxable income. Hoarding money in a shoebox under your bed does not help the economy. Spending money does, especially on things such as education, housing, and energy conservation. Total credits can never reduce your taxable income to less than zero.
All of these factors are to be applied without discrimination of income; if $1 can be deducted, then it can be deducted regardless of total income. And there will be no negative taxation - that is, refunds in excess of the amount withheld.
In a nutshell... Everyone pays their fair share, and our government can provide its necessary functions. Need more money? Work more or better your education. Avarice will cost you. And everyone will still complain about paying taxes - but equally.
A flat tax would not be the best choice in out economy.Forest of all, the flat tax only affects poor. Second , the flat tax would cause the economy to suffer. Lastly, the flat tax would take away from the incomes of business owners and other tradespeople. All Ina all, implementing a flat tax would be disastrous
I'm not rich, but I'm ok. I hated paying tax in the UK, because that was money I needed to keep up with the 80% of people better off than me. I don't have a house. I pay for health and my child's education, and tax on petrol. That is to help the people poorer than me [who I feel sorry for]... BUT - the welfare system keeps many people hooked, taking away dignity, incentive and self-confidence. Besides, many abuse the system, cheat etc. To reap the benefits of the system [I used to work in benefits, so I know]. Everyone wants to do better, have nicer things, eat properly, enjoy life - taxation is NOT the answer! All we need is a maximum wage! That's it, simple! No confusing laws, terminology, scales, weights balances formulas or equations... Just stop people from 'earning' [stealing] sick, immoral amounts of money [Oprah - $10 per second! Etc.] Then people, in a more egalitarian society, will live a more harmonious life... But not until then. The big picture here is most important. Choose whatever tax system you want, but it won't change anything unless you first admit the problem with the whole society [lazy poor & fat rich are common notions], and tackle it head-on.
Progressive taxes ensure that wealth does not stagnate in the hands of the rich. They ensure the poor are not faced with an undue tax burden. Flat taxes are regressive taxes for all citizens who make less income than the average. Here in Alberta we have a flat tax and have been having severe revenue shortfalls ever since it was introduced.
The best system would be a world with no taxes whatsoever. Everyone would have to pay for his or her services and goods when used, whether we talk about education, health care, security, arbitration, etc. Of course, a very low flat tax rate resulting in a system where no one sees their taxes increased is preferable to a steep progressive tax, but it is definitely not the best system.
Let's set the flat tax at 20%- a number that would allow for defense spending, police, fire fighters, etc. That would INCREASE the AMOUNT of money poorer people pay while DECREASING the AMOUNT of money wealthier people pay. People with more money are naturally much more able to pay a higher percentage and therefore will offset the tax burden of the lower classes who are less able to spare money.
I believe that "From each according to his ability" is a decent system. On another note, a flat tax places the burden of taxes more on the middle and lower class (Who are already struggling to make ends meet) and eases the burden off of the upper class (Who could more than easily live within their means while still paying a higher tax rate)