United States Should Institute A Flat Tax System

Since the creation of the United States, they loathed taxes, especially when the British taxed them without any representation. The United States anger towards taxes started the American Revolution; However, the United States needed some form of taxes to pay for the military. The military and several other things are what makes a country; however, there are some things that taxes pay for that should either be terminated or improved. A few things that taxes pay for does not contribute to the economy, instead, it costs the taxpayers excessive amount of tax money. In order for the country to decrease taxes or contribute to more education, security, and modern infrastructure, they need to terminate or improve the welfare and the war on drugs.

One popular method of tax reform that some of the experts in this field think is worth considering is implementing a flat tax also known as a consumption tax. J. D. Foster says that “any tax with a single tax rate could be considered a flat tax.” An article from the website Tax Policy Center defines consumption as being “income less savings” (Gale). The major difference between an income tax and a consumption tax is the way savings are taxed. With an income tax all income is taxed when it is earned and again when interest is earned on any savings. Critics of an income tax say that this is double taxation and

The flat tax system is more fair because there is less deductions and loop holes. If there is a flat rate people will not be able to exploit the deductions

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

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.

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

On the other hand, a flat tax structure implies the same amount of tax rate paid by all individuals regardless of their income brackets. This system further suggests that every taxpayer, regardless of the type of employment,

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.

"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.

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.

“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.

Nothing will be taxed twice, eliminating some confusion from citizens. An overall flat tax based system will have more upsides than downsides. “With a flat tax, politicians would no longer be able to reward their cronies and contributors with loopholes and tax breaks” (“The Flat” 6). Corporate tax rates will be low, luring in business. With a severely reduced corporate tax rate, more and more companies will start coming to America, instead of American corporations and big businesses leaving the States to receive a low tax benefit.

"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.

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.

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