There is a large ethical question that is brought up when you consider a sales tax or consumption tax to be the sole source of revenue for a state. The State of Texas uses a sales tax to generate its revenue, which is used for many public services that are needed to keep our family safe. Many people feel that this tax form is unfair to the poor, because they are having to pay the same tax as someone who makes much more than them. At a glance, this really does not seem fair, but when you look deeper you can find other ways that this type of taxation is more fair than an income tax would be. When you look at fairness of a sales tax you have to look at what is being taxed. In Texas sales tax is charged for everything you buy at a store except for unprepared foods and some Health supplies. It doesn’t matter if you are rich or poor you will not pay taxes for putting food on your family’s table. You will pay taxes on clothing, sporting goods, cars and household goods. So how is this fair? Its fair because you are paying a flat percentage of the sales price. If you are rich you are probably going to buy the more expensive …show more content…
Yes, an income tax taxes a person who makes more money a higher amount that a person who makes less which makes it seem fair, but is it really? Let’s take a look at who is actually taxed with an Income Tax versus a Sales Tax. With an income tax the only people who are being taxed are the people who legally have an income. A sales tax taxes everyone who buys things. There is a lot of people who have found ways to slip through the cracks and get paid an under the table or off the books. By getting their income in this way, they avoid having to pay an income tax. Is it fair that they can make just as much money as someone who get their income legally, but not have to pay a penny in taxes on it? That is how a sales tax is more fair than an income
California's tax code is unreasonable. It appears to be improving, with the rich paying higher tax rates than the poor. However, the poorest are still paying the greatest fraction of their income to the state because of sales taxes. Depending on local municipalities, state and local sales taxes can reach 9.25% in many cities and can be as high as 10.0%.
The Fair Tax is not a tax break. It ensures revenue neutrality meaning that the FairTax will give the government the same amount of revenue as the income tax system while spurring economic growth. The critics of the FairTax say that the rate should be at least 10% higher in order for the government to have revenue neutrality. With the substantially higher sales tax rate people may evade this tax and just buy the necessities. A vast majority of poor people are all in debt because they spend even when they don’t have money, when people have more money they save anyway. This fact leads critics to believe that since the poor and middle class spend the most they will be bear the burden of the substantially higher sales tax. FairTax answers this criticism by saying that the government will fully reimburse taxes for those whose income is below poverty level. The “prebate” discussed earlier and the elimination of FICA taxes
Although many Americans believe the top one percent should have higher tax rates there are also many people who believe that the wealthy pay more than their fair share of taxes.
The arguments regarding federal progressive income tax has been represented to us through the United States Supreme Court, on the floors of congress, and in media. The revenue from taxes reached the objective of financing wars from the Civil War through World War II. At the same time deteriorating the economy with fewer dollars that could be used on imports, exports, and services (Henchman). Today, the United States deficit is $18,800,241,350,538.12 this is a grand total of 58,405.32 owed by every man, woman, and child (Brown). The legal illusion is presenting the question, is income tax legal? There are Americans today who believe income tax is not legal and stand by their beliefs in a movement that has cost many individuals considerably. I am interviewing such a person, his name is Bobby Ray and the history he presented to me was interesting, and has left me with more questions than answers.
Property taxes in Texas have not always been the most favorite bill a citizen has to pay, some are large bills and some are small bills. Many legislatures and governors have played a role when it comes to property taxes and how much each citizen should be taxed. Depending on the area you live in, when it comes to school districts many have to pay taxes for more than one school district.
The state of Texas should not adopt a personal income tax. Any legislator who would propose a bill seeking to establish a state income tax would be seriously questioned, because a state income tax is currently unconstitutional.
The state of Texas does not have a state income tax. States collect taxes to generate revenue to operate. Texas collects the necessary funds from property and sales taxes. As of 2014, there are only seven states that do not collect an individual income tax. The other six states are Alaska, Florida, Nevada, South Dakota, Washington and Wyoming. Tennessee and New Hampshire have a limited tax on individuals, taxing only dividends and interest income. The lack of individual income tax is protected by Article 8 of the Texas State Constitution, which limits potential tax in the future as well. Texas funds itself through a 6.25% sales tax, taxes on motor vehicle sales and fuel, and taxes and royalties on oil and natural-gas production. Texas has
All tax revenue in the state of Texas help fund state programs available. Sin tax is no different. ‘Sin Tax’ is a tax on items that are considered harmful, like tobacco, alcohol, and gambling. In Texas, casinos are illegal so most revenue from sin taxes are based off the sale of tobacco products and alcohol. Texas also has placed sin taxes on places of business that host live nude shows and allow alcohol consumption at the business. This specific sin tax has been nicknamed the ‘pole tax’ for obvious reasons.
Yes it is true that everyone in this country is stated to be equal, but it is hardly fair considering that a majority of the country that struggles for just necessities to survive, pay as much as those who live leisurely and above most of the population in terms of wealth. This also becomes an issue with how much of tax is being collected by the government. Krugman puts a chart in his essay, showing that the tax percentages have been cut in about half. Krugman specifically says, “Between 1979 and 2006 the top tax rate on earned income was cut in half; the tax rate on capital gains was cut almost as much; the tax rate on corporate profits fell by more than a quarter” (Krugman 570). These kind of statistics are a huge issue for our country since the amount of money our country makes is decreasing. On the other hand, raising taxes won’t solve anything due to those in need of money as of now, but instead there can be a slightly higher charge for those in the upper-class. This will not only help the country’s income of taxes , but also lower the richest 1 percent of citizens to about 4.5 percent. Now number like these may not seem large or significant, but they actually are a major step towards the solution to solving the issue of social
The governments in any country use various taxation systems to raise funds to fund its national projects. The most common tax system is the income tax whereby the government raises funds from individual’s earnings. However, in the past few years, there has been heated debate about the adverse effects of progressive income tax on productivity and a proposal to replace it with national sales tax (Hodge, 2017). The national sales tax also known as the fair tax is intended to replace the current income tax and the idea is to enable the government to generate income from consumptions as opposed to earnings. This document examines the positives and negatives of the proposed national sales tax on the U.S. economy. The suggestion to impose a tax on consumption rather than consumption aims at encouraging savings and investments to improve productivity and promote economic growth. It is expected to promote fairness in the taxation because individuals will pay according to what they consume and not what they earn.
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.
Did you know that an astonishing 43.4 percent of the people in America do not pay any income taxes" (McCullagh 1)? This is roughly 65.6 million people that aren't paying taxes and this is putting our economy and country at its breaking point. Our current tax system penalizes those that work and save money. People that pay no taxes still get to enjoy the benefits. The United States needs to look at which tax is fairer to the people and easier to administer by the government. Although some may disagree, the Flat Tax should replace the income tax to simplify and bring fairness to the system, increase income, and create jobs.
Many people love the fact that Texas does not have to pay state income tax. Although it may have some advantages it also has a great deal of disadvantages. Texans are suspicious when it comes to changing tax laws and would rather keep it how it is now than having the government raise the taxes and change the system up.
Also many people can find ways around taxes, both legal and illegal, so they don't pay as much as they should be.
An income tax is a rate charged on the income of individuals as well as business (companies or other legal entities). Individual income taxes often tax the total earning of the individual, while corporate tax often taxes net profit of the company. Different tax systems exist, with varying degrees of tax incidence. Income taxation can be progressive, proportional or regressive. Tax systems define income differently such as inclusion of windfall earnings, and often allow notional reductions of income such as a reduction based on number of children supported.