The other point this article makes is that contrary to popular belief, a flat tax will not make it easier to file or collect taxes. What really makes filing and collecting taxes difficult are all the exemptions and such things that people have to look through to file taxes. These problems will not be eliminated with a flat tax.
Sunday, November 6, 2011
The Problem With Flat-Tax Fever
This article discusses the problems with a the flat tax proposals that Republican presidential candidates, such as Herman Cain and Rick Perry, are making. One of the main points it makes is that implementing a flat tax will further increase the income inequality that is present in our country. Studies show that countries with greater income inequality score lower on indices of health, well-being and quality of life.
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I like the idea of a flat tax. Everyone pays the same percentage of their income. It will make Americans feel more equal. Right now America is on the path for class warfare. The country needs to quit putting everything on the middle class and make things equal over all classes. If the middle class has to keep paying a higher percentage then the middle class will get poorer and the rich richer. This isn't right, government needs to quit lining their own pockets and worry about the majority.
ReplyDeleteThe role of the Government is to help its citizens first and foremost. What really bothers me is all this political bickering back and forth with no solid results for everyday Americans. Republicans stubbornly turned down Obama's Jobs bill, but Democrats have also turned down a Republican Jobs bull as well. The two proposals are very different, but in times like these someone needs to bite the bullet and do something. In bad times, the ends can justify the means.
ReplyDeleteAs Alyssa pointed out, flat taxes won't simplify anything unless you also get rid of exemptions. A flat tax would be feasible if and only if exemptions were cut as well.
If the flat tax plan is as easy as they say it will be, some of those 1.2 million professional tax preparer could be out of a job. Also, what kind of effect would a mixture of the progressive and flat tax rates. Something like a 10-8-6 plan.
ReplyDeletePeople often overlook the role an income tax plan plays in policy. It's one of the main ways we incentivize people to do socially positive things.
ReplyDeleteA flat tax very easily raises taxes on the poor and lowers it for the rich. Perry's idea: 20% flat and if you wish to keep your rate you can. What will happen? Those making 19% or under will maintain their current rates, and those making over 20% will have a reduction.
ReplyDeleteCain's is more simple and just puts rates at 9%. These are major tax cuts for wealthier people and raises taxes for poorer people. In my opinion, this is very unethical.
I agree with the first commentator here. It is an equal, democratic thing to say, 'ok, everyone pays this percentage of your income, then go on your way.' Make it without all the current exemptions, so it would actually be simple to file. I have no problem with saying that a family of four who is making under $50,000 annually doesn't have to pay? But the rest of us? Let's make it an equal tax.
ReplyDeleteThe idea of a Fair Tax, or a Consumption Tax, is also interesting, and possibly a more progressive way of updating how we do taxes.
I feel that the governments basic job is to reduce income inequality. As such the rich should have to pay higher taxes but it should be only marginally higher this is because it should not be like a sin to be rich. At the same time there should be consumption tax on products like paintings, soda, etc which are mostly consumed by the rich.
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