Disadvantages Of Income Tax

The current tax policy in the United States is very confusing and it is very costly for our government to administer it. It is in the best interest of our country and its citizens to revise or replace our current tax policy.

“The weight must be distributed equally — not upon each man an equal amount, but a tax proportionate to his ability to pay.” — Representative Justin Morrill (Republican — Vermont) (Shepard, 2010). Graduated income tax is a system of taxation in which people are assessed at a greater percentage of their

There are two basic forms of taxation within the United States: progressive, where the effective tax rate increases as wealth or income increases, and regressive in which the effective tax rate goes up as wealth or income decreases.

The view on the current government tax policy is considered “bloated, complex, and antiquated system” that overburdens United States taxpayers. Back in 1996, a proposal was brought by Republicans to Congress which was then passed, but sent to Clinton who later vetoed

The tax system in the United States has changed throughout the years, with many attempts to make it "fair" or "equal" while at the same time generating enough income for the United States government to thrive. It is a complex issue, and a controversial one at that. While it may not be possible for our tax system to ever be fair, it is important to make sure it doesn 't put more financial stress and pressure on one group than on another.

The issue of taxes and different tax systems is arguably one of the most important issues to many Americans. Having an effective Tax Code is definitely important in maintaining a healthy economy; however, there are different perspectives when it comes to the rates and percentages that citizens pay.

Meaning that taxpayers pay more in taxes if they earn more in income. For example, taxpayers may pay 25% of their income in taxes up to a certain amount, and 35% of everything earned over that amount.

The IRS argues against the flat income tax since it is regressive with all taxpayers paying the same tax rate. While it is true that the current federal income tax system is progressive, the primary argument for a flat or flatter tax is to simplify the tax system. A flat or flatter federal income tax system with a limited number of exclusions and deductions could accomplish the same goals in a much more expedient way.

Our current income tax system today is very complex, unfair, inhibits saving, investment and job creation, imposes a heavy burden on families, and weakens the integrity of the democratic process. It can't be fixed and must be replaced. The U.S. income tax code is a long and complex system. The income tax system is so complex; the IRS publishes 480 tax forms and 280 forms to explain the 480 forms. The IRS sends out eight billion pages of forms and instructions each year. The administrative costs of the tax system far exceed those borne directly by the IRS. Each year Americans devote 5.4 billion hours complying with the tax code, which is more time than it takes to build every car, truck, and van produced in the U.S.

The article goes on to state, “The end result is a worker facing these rates may just decide it doesn’t make much sense to take on extra hours or put in the effort to learn extra skill to increase their earnings potential.” Implementing a progressive tax would tax an individual who is just getting started very little at first. However, the amount of taxes would increase with the more money a person has made. Having a progressive tax will help to reduce the national debt and would help the poor be able to increase their individual wealth further reducing inequality. A possible snag to the progressive tax would be strategic investments made by the wealthy to avoid having to pay taxes. The tax needs to be progressively based on income because 41 percent hurts the poor more financially than the 39.6 percent does the

In a Progressive Tax system, a larger percentage of income is taken from those who are wealthy or have a large annual income, in taxes. Those who have low incomes do not have as high tax percentage to pay because progressive tax is based on

We have all heard the famous quote by Benjamin Franklin who stated, “In this world nothing can be said to be certain, except death and taxes.” (“Benjamin Franklin Quotes”) We find this to be true as we begin working and feel the pain of money being taken from our paychecks. Then we face the chore of having to file income taxes yearly. Although there are many taxes we are subject to, most people are referring to federal income tax when they complain about taxes. There has been debate for decades about the current system but there has been no agreement on how to fix it. The United States currently has a progressive tax code which means people pay taxes according to their earnings. This has been in place since the time of Abraham Lincoln. An alternative

In addition to economic issues, taxation is also a political issue. Political leaders formulate tax policies to bring reforms in the taxation system in order to promote their agendas. The major tax reforms include: increasing or decreasing the tax rate, imposing new taxes on certain products and changing the definition of taxable income. It is evident from the research studies that no one deliberately wants to pay taxes. U.S’ tax policy reflects expression of influence - i.e., those who have power are successful in paying low taxes and their burden is shifted to people who have no power. Therefore retired individuals, small business owners and farmers find ways efforts to reduce their tax burden. Since its existence, tax policy has been enormously used for promoting political and economic agendas.

Taxation systems are usually modeled in such a way that they take into consideration the social welfare of the citizens. The government and other policy makers have the responsibility of ensuring that the system takes into account the needs of the citizens. The bottom line is that taxation should foster equal distribution of resources. The rate of taxation is usually arrived at after several considerations have been made. The rates are not fixed as they depend on the various economic changes. The issue of how taxation should be distributed among the different economic classes is yet to be addressed.

When I went back to my notes that I took during the Taxation class and think about filing a tax return with IRS I see that there are a lot of similarities between individual tax and business tax. However, weighing individual and business tax on the same gauge will evince how much they are different from each other (Pack, n.d.). Individual taxation is a type of tax return filed by an individual for both single and married taxpayers whether they have dependents or not, they will file the tax returns on Form 1040. The Form 1040 indoctrinate tax filers for information on their filing status and number of dependents, the income section includes wages, salary, taxable interest, capital gains and other types of income. filers can claim deductions for expenses, education, moving expenses and many other categories.