The Debate Over Fair Tax

The rich should not be taxed more. Increasing tax rates for the upper class will not solve the present inequality problem. The wealthy americans should be expected the same amount of taxes as the poor for equality. Those who earn more shouldn't help the less fortunate because they worked harder for the money they earn.

Currently, the United States ' taxation system is progressive, which means the more money a person makes, the more that person is taxed. According to the Congressional Budget Office 's website,

There are three different types of tax systems presented in this article: Progressive income tax, Flat tax, and the Fair Tax. The progressive tax system is what we have in the US and is common in countries across the world. It bases the percentage of income tax you should pay by the amount of income you receive. Basically, if you have a large income then the rate of tax you will pay is larger and, furthermore, if you have a low income you will have a lower rate to pay. Many conservatives dislike this system because it forces the top percentage of taxpayers to pay a majority of the tax revenue. “According to the Tax Foundation, the top 1% of taxpayers have consistently paid more in federal income taxes than the bottom 90% since 2003…” It treats people differently and it allows for

The United States is a capitalist society; money is powerful. The wealthy and those in power are able to influence tax policy. There are a few tax policies that have more of a benefit to the wealthy than to the poor. A few of them include the mortgage interest deduction, the yacht tax deduction, rental property, business meal deduction, capital gains tax rate, estate tax, social security, and savings for retirement plans.

Furthermore, Buffett provides his personal example that last year he paid the least percentages of taxes in his office. Buffett uses several precise data to show the difference. In the third paragraph, Buffett states, “But what I paid was only 17.4 percent of my taxable income—and that’s actually a lower percentage than was paid by any of the other 20 people inner office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent” (275). The exact numbers like 17.4%, 36% provide strong demonstration. From these two number we could easily find that Buffett, as one of the richest person in the world actually paid half percentage of taxes compare with his co-workers, who are all in middle class. Additionally, Buffett states, “The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically

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.

“Considering that the top marginal tax rate for the wealthiest Americans today is 35 percent, that figure seems astounding. But it's true that in the 1950s, the top marginal tax rates were over 90 percent” (Farley). Many may think, how does lower taxes on the highest income earners have an effect on them. Simple, less funding of programs that enrich the quality of one’s life. When the government does not receive the needed funding spending cuts must be made. Unfortunately, these spending cuts are more often than not are on government programs that help those who are

Another huge problem is the way that the tax code works. As Warren Buffett explains, the “tax code is tilted towards the rich and away from the middle class.” It’s actually upside-down those with more pay fewer taxes, than people with less. Though the top rate for wage-based income is 39.6%, the rate for income from investments (capital gains) is only 20%. That means wealthy people pay a lower tax rate than the rest of us. Examples include Buffett, whose tax rate is about 17%, while

A study by economist Thomas Hungerford of the Economic Policy Institute found that, “By far, the largest contributor to increasing income inequality (regardless of income inequality measure) was changes in income from capital gains and dividends” (HUNGERFORD). In order to comprehend the effects of reducing the capital gains tax rate, the Internal Revenue Service offers data on the top 400 earners average tax rates from the year 1992 till 2009. The very top 400 earners received an average tax rate of 26.38 percent in 1992, and it then dropped to 19.91 percent by the year 2009. When the date for the average tax rate for top 400 earners is graphed against the maximum capital gains rate, the relationship is nearly perfect with 95 percent of the changes in the average tax rate being accounted for by capital gains tax cuts. The data clearly shows that by lowering the capital gains tax, America is significantly increasing the wealth of the top earners and widening the wealth inequality gap.

The Bible unequivocally commands believers in Christ to submit to the human authorities that God has placed over us. One facet of this submission to authority involves dutifully paying our taxes. Indeed, Paul enjoins, "For because of this you also pay taxes, for the authorities are ministers of God, attending to this very thing. Pay to all what is owed to them: taxes to whom taxes are owed, revenue to whom revenue is owed, respect to whom respect is owed, honor to whom honor is owed" (Romans 13:6-7). Because God's Word never changes, this tenet undoubtedly still applies to every follower of Christ living in America today. While I do believe that we as Christians must faithfully pay our taxes due to the government

With the next presidential election just around the bend, there have been many heated policy debates on both sides of the caucuses. One of the more intriguing of these has to be the debate on the structure of the current tax system. Many GOP hopefuls are putting forth plans to impose a Flat Tax System. The scope of this paper is not to analyze, per se, the reasons behind their putting forth such ideas. Instead, this paper will attempt to analyze the ethical considerations and ramifications of a flat tax system as opposed to our current progressive system. In order to accomplish this goal the following study will: present a thorough analysis of the background surrounding this issue; the stakeholders and their involvement in the issue as well as the issues effects on each; two ethical theories and test and how they apply; and finally a Biblical interpretation on the ethical issues that will be brought to light and a suggestion to believers on what side they should take given the analysis presented.

Also, the statement, “A higher capital-gains rate would just level the playing field” is taken from a skewed view of where some of the rich get their income from. Although, as Moore explains, he justifies that even though, capital gains and dividends are taxed at a lower rate, it is a tax that is on top of corporations’ taxes.

The United States Federal Government currently functions on a “progressive tax system”. A progressive tax system is based on ability to pay and therefor requires members of higher socioeconomic standing to pay higher federal income tax rates. The idea is that wealthy people, whether they are wealthy as a product of their own intelligence and labor or wealthy by inheritance, can afford to pay higher tax rates and still maintain a quality of life well beyond what is considered livable or even standard. This procedure understandably creates a lot of upset in the upper-class community. According to the IRS, in 2007, more that 44% of income tax revenues came from the top 5% of earners and more than 50% came from the top 10%. In the same year, the 400 wealthiest Americans, bringing in an average adjusted gross income of $345 million paid an average federal income tax rate of 17%, whereas the average tax payer during the same time period paid only 9.3% of their gross income to the federal taxes. In 2010, about 45% of all

The middle class ($50,000-$99,999) paid 14.9 percent of individual taxes, while the poor class paid 0.1% of individual taxes. The 1%, rich class, paid more than the middle class and poor class combined, yet they aren’t paying their share in the eyes of so many. In 2011 the 1 percent, people who were making $100,000 and higher paid 23.8 % of the total tax liability and 9.1% in 2000. According to the National Tax Payer’s Union, in the tax year of 2014 the top 1% ($465,626 AGI) paid 39.48% of taxes, while the top 50 % -25% ($38,173-$77,713 AGI) paid 10.47%, and the bottom 50%(<$36,841 AGI) still paid the least with paying only 2.78% of

With today’s tax system, Americans feel like they are constantly shoveling their money out the door. People who object the flat tax system argue that it isn’t going to be able to fund the government, but most of us know that our government has a spending problem…not a revenue problem. “In 1970, the federal tax revenue was $192 billion; in 2010, tax revenue was $2.1 trillion – and it still isn’t enough money to pay for all the programs that politicians want.” ("Creators") With this new system, every income group would gain. Through the earned income tax credit, most low income Americans would be eliminated, benefiting the majority. In another sight the gains of the highest income group would be third highest among the six income groups. The income in tax variation and change in incentives would end up resulting in an increase of 1.8 percentage points for the economy.