Taxes: Distributional Effects Essay

The obvious questions to this position are at what income levels should taxes begin to increase? Also, how much should their taxes increase? We know that high tax rates can be detrimental to an economy, largely due to the deadweight loss that the taxes impose on the markets. Combine this with the fact that the government has proven to be inefficient with the tax revenue it currently has at its disposal, and it is hard to find a suitable argument for why taxes should be increased on the wealthiest

Introduction Taxation law may be described as the body of law that governs liabilities of persons to pay to the government. In this report, I will determine to Jack John’s taxable income during the given income year. So as to give proper legal advice to Jack Jones, I have to take into consideration those issues, determine taxation residency status, determining assessable income for the year and calculating deduction of the year. After all those issues discussed regarding Australian taxation law, it possible proper advice to Jack John accordingly his assessable income and deductions. Taxation residency status According to the taxation law, Australian residents require to assess their income (ordinary and statutory income) which is derived

First off, there are many people who do not even know what a flat tax is. By definition, a flat tax is described as, “a very precisely defined and coherent tax structure: a combination of a cash-flow tax on business income and a tax on workers’ income, both levied at the same, single rate” (Keen 4). Now, this just means that every person and every business, no matter the income, would be taxed at the same rate. Realistically speaking, when people talk about taxes, it is a matter of who wins and who loses. If we decided to adopt a flat tax system, people of lower income families would be suffering, “Under the flat tax, low-income households would lose because they now pay no income tax and are eligible for a refundable EITC of up to $3,370” (Gale 155). With this being said, the families of higher income would actually be thriving of a system

A increase of tax from the current 0.5% to 1.95 would substantially increase Medicare revenue by 34.48% that if changed back then during the year 2012 revenues would have expected to be around $716.4B.28 A way to decrease federal spending is the method of cost sharing. It is an insurance policy that the individual who is insured has to pay a portion of the costs of the covered services.29 A unconventional way to help with the Medicare crisis is to promote immigration. Immigrants usually are younger and are likely to be in the working age. Promoting immigration can grant a substantial workforce that can increase tax allocation, thus, improving the economy.30 Though it may seem that immigration might help give more time to solve the crisis, it isn’t a permanent

Generally, the income earners pay less income tax and more payroll taxes while the high-end income earners pay more income tax and less payroll taxes. The low income earners however get credit benefits as the government pays for their payroll taxes. Therefore, the high income racket still suffers the burden of individual taxes. In 2014, the bottom 20% had an effective tax rate of -4.5% while the top 1% faced an average of 24.6% a margin of 29% creates a very huge economical gap between the rich and the poor. This only ends up hurting the economy more. As a result, I believe the highest effective tax that should be applied to the top 1% should not be more than 20%. If it goes beyond 20%, they shall start demanding for tax cuts and further design ways to evade the tax payments.

I feel that marginal tax rates are fine how they’re now, according to FRED the marginal tax rates have been stable since 1993 and haven’t been significantly changed since. If it is needed by it should be raised but we wouldn’t want the risk of government taking too much money that they don’t need.

"The most perennially political issues in the United States is the question of how much Americans should be taxed. Indeed, discounted over taxes was one of the major motivating factors in the revolution that established the United States as an independent nation"("Extending Tax Cuts", 1). Since taxes are one of the biggest topics in politics, there is always going to be two sides of the subject, and Taxes will always strike controversy in our country. The topic of having the rich pay more in tax has a deep history to consider, and there will always be both supporters and critics who continue to debate this topic.

“Existing government programs-mainly Medicare and Medicaid-face severe financial challenges, particularly in an environment plagued by an escalating national debt crisis” (Shi & Singh, 2013, p. 342). Currently, the national debt is more than fifteen trillion dollars. The immediate answer created by the President and politicians was raising the debt ceiling. However, this solution will only allow them to spend more; it does not resolve the open ended question of how to reduce the debt (Shi & Singh, 2013). Consequently, government programs are at risk, more notably Medicare.

"A revolutionary change in our tax system is fundamental to re-energizing the American economy and restoring the American dream" (Moore 1). Currently, there are two major plans being considered to try and fix the tax system in the United States. These two plans are the Flat Tax and the National Retail Sales Tax. "Both the Flat Tax and a National Sales Tax would replace today's discriminatory tax structure with a single low rate. Either plan would promote the kind of capital formation that America needs to boost workers' incomes and raise long-term economic growth" (Mitchell 1). This means that the flat tax would take away the savings from the government and pass them on to the citizens and businesses. By doing this, there would be a rise in long-term economic growth.

Tax rates have been falling around the world for decades. In the countries where there are the lowest taxes, such as Chile and Singapore, there is the fastest economic growth. If the U.S wants the economy to grow, then they should not raise taxes. First, the U.S tax system is already wrong and unfair. Americans that make a lot of money, pay more in taxes. According to John Lott, “Fives times more income means paying 33 times more in federal taxes”. Most Americans work incredibly hard for their money, especially business owners. Decreasing tax rates will allow more Americans to want to work and will help the economy grow.

Even though some may think taxing the rich is pointless, the poor might not think so. For the rich to pay even 45% more tax each month won't affect them in any way. This process will definitely be helpful towards the poor. As many articles stated “the richest people in America have been getting richer very quickly” (Steele). Many people have been concerned about this outcome; therefore we as Americans have been working hard in order to fix the taxation problem that has swept away the

Throughout history, taxation on United States citizens has proven to be a necessary component of a growing economy as means of generating revenue for the federal budget. The federal budget funds the many government programs implemented to keep the disabled, elderly, and unemployed from falling bellow the poverty level. Unfortunately, this fund is not always available when catastrophic evens, such as an economic recession, deplete the revenue coming in and create a budget deficit. In order to regenerate money coming in and replace the deficit, the government calls on money gained from taxes. What happens when tax money is already appropriated to other programs? A tax reform. A tax increase has many times been the

With that in mind, everyone would be getting the same treatment, if we had a flat income tax rate. Thus eliminating the form of conflict that is known as “unfairness”, or the belief that nobody is getting treated fairly. This conflict is one of the most viscous, as it will turn even brothers against one another.

With the ever-changing difficulties of our health insurance landscape, the government has taken a more active role in the health care and well-being of American citizens. With this shift, programs like Medicare and Medicaid, become polarizing topics in an environment where individual finances are tight, our economy is struggling, and the future is no longer as predictable or financial secure as we once believed it to

One of the obvious reasons to raise the taxes of the rich would be because they simply earn more. One example is if two people started the year off with fifty thousand but then let us say one had a rich family member that died and they had received millions through a will, then say they received a gift of one billion by the end of the year they pay the same taxes even though one of they are now a billionaire (Cohen). The reason is that the government does not tax on gifts or wills so then they would not have to pay more taxes if they received a gift that had consisted of a large sum of cash (Cohen). Now there is a large chunk of change out of circulation and now the middle/lower