In our country, some of the most opinion-filled conversations to be had involve taxation. Taxation refers to compulsory or coercive money collection by a levying authority, usually a government. Funds received through tax collection are used in many different ways; a large portion of taxes collected fund our military, are applied towards the United States’ national debt, federal relief organizations, and to law enforcement and other government agencies. Although every working American is required to pay taxes based on their income, deductions, and withholding allowances, the way in which those wages are taxed has often been questioned. Here, we use a progressive tax rate structure. This method of taxing income increases as the tax base, or …show more content…
The most prominent similarity that the progressive and proportional (also Flat Tax) structures share is that they are both unfair in each of their own right, according to those who oppose one or the other. Differences, however, are many. For example, flat tax is meant to even out the playing field, so to speak, by making the tax rate on income one set percentage; whereas the progressive rate gets higher with the more one earns. The theory is that no one would be penalized for making too much, or in contrast, too little money. Another distinct difference is the taxing of dividends. Our current tax structure requires double taxation of dividends, meaning that they are taxed on the business and individual level. Flat tax would eliminate the individual taxation of dividends by requiring only the business to pay taxes on dividends disbursed to investors. “The United States’ tax code treats corporations and their shareholders as separate taxable entities. The result is two layers of taxation on corporate income: one at the corporate level and a second at the shareholder level.” To some, mainly those who receive a large portion of their income from investments and dividends, flat tax is the better …show more content…
Having a flat rate can simplify the filing of taxes and calculations, decrease and possibly eliminate the need for the Internal Revenue Service (IRS), and provide one tax rate to all working citizens. Currently, filing taxes is a daunting task that generally requires a professional in order to complete the process adequately. Many forms, extra time and in most cases, fees, are the basics needed to file taxes. The filing process is so simplified with flat tax, that not only would the numerous forms be null and void, so will some of the professionals associated with the field. For taxpayers, this is wonderful because it streamlines tax related activity, making it easier to handle on their own. The elimination of forms, professionals, and complexity may also create the decreased need for the IRS. Unfortunately, no one really cares for the IRS, so eliminating interaction with the agency is always a welcome thought for taxpayers and may alleviate stress associated with the dreaded “tax season”. Perhaps the most attractive attribute of a proportional rate is the use of the same tax rate for all taxpayers. A flat tax will not change or fluctuate regardless of how little or how much money is made. This, to many, is the only fair way to treat workers and gives a level playing field for taxpayers to be able to use the majority of their wages for
Flat tax and progressive tax either can be considered fair or well put together for the American people since it has a rational approach towards taxation. However they do vary from each other when it comes to its treatment of the wealthy people, and each of this system is biased and discriminatory, but at least one good aspect of progressive tax is that people of lower income are still paying low and under flat tax they will end up paying same as a wealthy individual who is well. Only because the name of a policy sounds progressive does not mean its action has to be. Furthermore, the current progressive tax policy is only a few steps away from becoming the flat tax and there is no difference among these two. So if the flat tax is being implemented in the United States it will have validity to do more harm to the majority of the Americans then giving them any
In conclusion, there are several valid points on both sides of the argument of adopting a flat federal tax. Doing so would undoubtedly make the process of filing taxes much easier, but in my opinion, flat rate taxes should not be an option. I do not find it fair to tax a certain percentage of income which would be a big hit to lower income households and businesses, but a more minimal hit to someone with a higher income. To a wealthy person, that percentage of money could mean sacrificing something relatively unimportant,
With having the above statements showing the cons of each system, it is fair to say that having a flat tax would be good for our system. It would make everything equal for every class, and not have any or as much negative comments directed towards it. Changing from our “burden” system to flat tax would be a win win for
People do not enjoy talking about taxes because they are too political, confusing, and depressing. It is no secret that the American tax code is a mess and something many economists describe as too broken to fix. Despite this, politicians have never stopped from trying to “fix” the code, yet they have had very little success. The U.S. Government’s tax code currently comprises “more than 67,000 pages of complexities” (Boortz, Linder, & Woodall 14). The Americans for Fair Taxation (AFFT) was founded in 1995 with one goal: create the simplest and best tax reform plan that would work in the modern market and economy. The AFFT’s best solution was a bill which they promptly called the FairTax.
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.
The use of flat (proportional) tax rate seems like a fairer option in my opinion. The reason why I think this is because we talked in class that the more money you make the higher your tax bracket is requiring the rich to pay more and the poor to pay less in comparison. This is causing companies to go overseas rather than staying in America which in effect could cause less jobs in America in general. Secondly, I feel that it would make a simple system and allow everyone to know exactly how much their going to pay for taxes.
Throughout the entire existence of any form of government, there has always been taxes. Most of the time (if not all), people hate taxes. With this being said, the United States has adopted a progressive tax since its very existence. We believe that if our nation is placed under a flat tax system, our economy will operate more effectively. If we incorporate a flat tax system we will be able to ensure fairness among all citizens, eliminate tax loopholes, and allow opportunities for business expansion. With this being said, we will be examining the strengths and weaknesses about the flat tax system and how it has been used into practice.
A flat tax system in the United States by definition refers to taxing household incomes at the same rate regardless of income levels. Advocates of a flat tax system argue that it will simplify U.S. tax codes and eliminate other taxes. Opponents of a flat tax system argue that it only benefits wealthy individuals and would eliminate the IRS causing wide-spread unemployment. Here are some of the pros and cons of a flat tax system.
“I love paying my income tax! This tax system is so easy to understand!” said no United States citizen, ever. No one has ever said this because it is highly unlikely that no one actually enjoys struggling with the complexity of the current income tax system in the United States. The concept of contributing to the good of the community, county, state, and nation through taxation is not new, nor is it generally opposed by American citizens. Most tax paying citizens do not take issue with paying for police and fire protection, roads, and national security with tax dollars. However, what they do take issue with is the fact that the current tax code is a complicated nightmare. It is a bureaucratic mess of rules, regulations, and perhaps even infringements upon personal rights. Because of the complexity of the current tax code, the United States should implement a flat tax system for personal and corporate income tax to ensure consistent and fair taxation and to render the tax code as more user-friendly.
The flat tax will restore fairness to the tax law by treating everyone the same. No matter how much
The supporters of the Flat Tax system are quick to point out this system's attributes but not as quickly as the criticisms by those who oppose it. The filing of taxes each year would be much easier because there would be one set rate to pay. This type of system also discourages, and makes it almost impossible, to find and use any existing schemes that are present to avoid paying taxes. However, because there is a set rate at which everyone needs to pay, this system is quite unfair. Those who earn and have a lot of money should not pay the same amount as someone who has only a fraction of their wealth. The wealthier you are, the more you should pay because you can afford it. If there is a set tax rate it would be too high to some people and pocket change to others. A system like this also takes away many, if not all tax deductions. An event like this would cause irreparable injury to the middle class, who often times rely heavily on money they will get back from tax deductions.
Taxation rate is a very controversial topic in America. Many people like Mark Rosenfelder, Author of Why the Rich Should Pay More Taxes, believe that the more you make the more you should be taxed. They justify this by saying that Upper class, well-to-do individuals take more from the government. They say because wealthy people have more, they have more to lose; thus they require more protection. Many believe that a flat tax, a tax in which all citizens pay equal tax regardless of their income, is unfair. Really? Taxing someone because they work hard and make more money seems to make less sense. Raising the tax rate just because they work hard and have more than other people isn’t right. The wealthy upper-class citizen did not make the lower class poor and shouldn’t be taxed heavily to support them. In his essay Rosenfelder focuses his attention on how to bleed the wealthy for their money through a progressive tax.
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
Policy makers have introduced a solution to the staggering proportion of taxes that Americans spend. The flat tax, based on an idea developed by Professors Robert Hall and Alvin Rabushka of Stanford University to create a fair, simple, and pro-growth tax system (Mitchell 1, 11). There are four basic criteria that make up a flat tax. First is a single low rate on taxable income, the baseline for taxable income would be raised to a certain amount dictated by a personal exemption. Second is simplicity, all Americans would fill out the same postcard-sized form to pay their taxes. Third is the reduction or elimination of deductions, credits, and exemptions, depending
Throughout Shakespeare’s career, the unbelievably successful author had published a multitude of plays with unique variations in theme, tone, and overall story. Nevertheless, all of the works are sorted into one of two contrasting categories: a tragedy, or a comedy. Taming of the Shrew is commonly known as one of his greatest comedies, due to comedic effects that are put into play through the mocking of men and women, involving crossdressing and basic gender stereotypes. It begins with a lord performing a play consisting of the Taming of the Shrew, making it a frame story. The story is about men wanting to marry a perfect woman, Bianca, but none can marry her until her “shrewish” sister Katherina has been wed. A man named Petruchio hears about this and takes advantage of Katherina for the money and position of power, and eventually “tames” her. Through the entirety of this play, it is very clear that women are viewed as lesser through the parody that the Lord and his men are putting on. This can be seen through the portrayals of the female characters and how they are treated. Bianca is an ideal, perfect female to everyone that knows her, but Katherina is just a bit different, which automatically gives her the label of a “shrew”. The constant comparison to her sister has given her a sharp, twisted view of the world, overall leading to a bad effect on her personality. This is expanded upon when Katherina’s suitor Petruchio tries to woo her and she is not fond of him, but then her father allows him to marry her. He creates a very toxic relationship filled with abuse and mistreatment, all justified as taming.