Flat Tax Reform : A Call

It is the general agreement of tax payers everywhere that the current tax system is way too complicated. You either need to have a certified public accountant help you do them or a specialized tax program to walk you through it. Not only that, but the costs associated with having someone prepare your taxes or buying the specialized computer program needed to navigate the myriad of entangled tax codes and laws can become quite expensive. But it is not only expensive for us, the individual tax payer, but it is also expensive for businesses and it is extremely expensive for the Federal government. Not

In my opinion as to whether or not the current federal income tax structure is fair for most Americans is that it is not fair. The following information will provide support for my decision. The main federal tax brackets are for single individuals, married individuals filing separately, married individuals filing as a couple and individuals filing as a head of household. In the financial year 2014, the lowest tax bracket paid a rate of 10% on income up to $9,075 while the highest bracket paid an average rate of 36.4% ($406,751 and above). Most individuals pay taxes across several tax brackets, and as a result, they end up with the progressive tax structure. In the current progressive federal income structure, individuals with a lower

My community decided that the best tax system would be to use the 2-point flat tax across our community. We decided as a group that it would be fair, because each member would be taxed the same regardless of their role. The treasurer, and myself being mayor could also map out how many points we would have for the rest of the semester. This would not have been the same if we had decided a percentage based tax or one that first needed to know the quiz score. I believe that our preparation for potential threats to our community prepared us for when they did occur.

Although this year’s budget gap of $14.6 million was a far cry from the $104 million projected shortfall in July 2017, the state is anticipating another tough budget year in 2018. With tax revenue in such a precarious state, it is unwise to continue using a tax system that is failing the state economy. The legislature should pursue prudent reform on corporate taxes to increase the possibility of recouping lost revenue from past years, or at the very least, prevent another round of budget shortfalls and spending cuts.

Taxes are a necessary component for operating a government, however, they are also the source of great debate within our society. Especially when considering what types of taxes to use, and how much to tax the population without negatively impacting the economy. Income taxes are currently one of the biggest sources of income for the government, but are also one of the biggest concerns given the level of complication involved with the current tax system. Although many argue that the current progressive tax system contributes to our country’s economic growth, research indicates there may be benefits for simplifying the income tax system without stalling growth. One theory indicates implementing a flat tax system would not only provide consistency for businesses and consumers, it would positively impact economic growth. If given the appropriate considerations, including an equitable rate, a flat tax would increase consumer confidence and lead to an increase in consumption, and ultimately growing real gross domestic product (GDP).

The current income tax system is very complex. It is so complex; that the IRS publishes 480 tax forms then they publish another 280 forms that explains the 480 forms. “The IRS sends out eight billion pages of forms and instructions each year, which, if laid end to end, would circle the earth 28 times. Nearly 300,000 trees are cut down each year to produce the paper on which IRS forms and instructions are printed” (Armey, Shelby). The main reason the tax code is so complex is the proliferation of deductions, credits and other special preferences in the tax law. Taxpayers with similar incomes can pay vastly different amounts in taxes because of these loopholes. This uneven treatment of taxpayers is

Although, a flat income tax rate is assumed to bring equality to income taxes, it holds a greater burden to the middle and lower class, than it does to the higher class. The flat tax rate would set an equal amount that everyone would be required to pay. It would ignore the difference between rich and poor taxpayers, which could be drastic. This would result in the middle and lower class possibly paying more and lose money for basic survival needs, such as housing and food. In America, progressive income tax rate is what we favor. It is the taxing mechanism in which the taxing authority charges more taxes as the income of the taxpayer increases. A lower tax is collected from taxpayers who earn less.

Taxes are a required aid from individual incomes or business profits collected by the government that funds certain activities and services is provided by the government for the people. Taxes in the United States can be originated all the way back to the 1760s. The current tax system the country has is a progressive tax. A progressive tax is a taxation system where higher incomes get taxed at higher percentages than those with lower incomes. The tax system that has been proposed that the economy should switch to is a flat tax. A flat tax is a system where all income would have to pay the same percentage towards taxes regardless of how much money they make. This has been a major controversy because of the major impacts switching the

Implementing a flat tax system may dismantle the IRS. Many Individuals have a perspective of the IRS that is in a negative manner. They feel as if the IRS is imposing and intimidating. Although this establishment employs numerous individuals who were qualified to work in the tax industry, the IRS employees have a higher risk of losing their jobs under a flat tax system. Many individuals believe that a flat tax system benefits the rich more than the middle class. They also believe it reduces the high-income individuals taxes. If the rich paid less, many individuals believe that the government would. If the rich paid less tax, many believe that the government would surrender a serious amount of revenue. A uniform tax rate treats individuals and corporations adequately, but it defeats a substitute revenue source, the additional money made by taxing high-income earners at a higher rate for the government. The government does in-fact rely heavily on revenue generated from income

The flat tax has been the topic of debate for some time. Those for and against it have a strong argument with many valid points. The strongest view in favor of a flat tax is the simplicity of one basic formula applied to everyone regardless of income. Deductions, loopholes and tax shelters are no more. Income is multiplied by a single tax rate and the result is one’s tax liability. No grey areas, no burden of proof or records retention schedules, no flow charts or complicated forms to follow. The current tax code for the United States a complicated network of 3.8 million words making up 11,000 pages (ToughNickel.com, n.d.). A flat tax would be easier to understand, meaning fewer errors, an increase in compliance and a decrease in tax fraud. Less time, money and energy will be spent on monitoring compliance and pursuing amounts owed. “In a typical year, the IRS estimates that for every dollar it collects, another 19 or 20 cents is owed, but not paid (Economist.com, 2005).” Resources could be used elsewhere.

The United States is a nation that that was founded upon principles of liberty. The founders of this country have instilled this into our foundation and culture. It is no coincidence that taxation has been a top political issue since the formation of our government. The tax code has been continually adjusted and is currently up for new reform. Due to many variables, there is a discrepancy between the top nominal corporate tax rate and the effective rate that corporations actually pay. Aligning the nominal and effective rates would allow for easier accounting, reduce the marginal cost of paying taxes domestically, better alignment of incentives, and as the domestic and global economy is changing, so must the tax code to be adequately

Taxes are a required aid from individual incomes or business profits collected by the government that funds certain actions and services provided by the government for the people. Taxes in the United States originated in the 1760s. The current tax system the country has is a progressive tax. A progressive tax is a tax system where higher incomes tax at higher percentages than those with lower incomes. The tax system that was anticipated that the economy should switch to is a flat tax. A flat tax is a system where all income would pay the same percentage towards taxes regardless of how much money they make. This is a major controversy due to the major impacts switching the current tax system would have on the nation’s economy as a whole.

Both the American people and members of the Federal Government have long griped about the current U.S. Personal Income Tax System. Bush’s Advisory Panel for Federal Tax Reform stated that, “the complexity of our tax code breeds a perception of unfairness and creates

First and foremost, there are always pros and cons of every issue. The same applies to flat taxes, however, there are more drawbacks to the implementation of a flat tax system than there are benefits. In reality, a flat tax system does not offer income equality amongst taxpayers. If the United States switches to a flat tax system, it would greatly exacerbate longstanding growth in income inequality (Frank 1). A flat tax would increase inequality by substantially reducing rates on wealthy

However, another proposal that has become popular completely eliminates the current progressive tax code as well as the idea of a flat tax. The Fair Tax is not a tax on income but instead would replace all existing income taxes including payroll taxes, with a single consumption tax (Erb.) Discussion about the flat tax versus the fair tax in comparison with the current progressive income tax highlights a wide perspective of views about the appropriate way for the government to collect revenue from its citizens. Supporters of all three configurations make sound arguments to justify continuing with the current system or adopting one of the two alternatives.