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It's unreliable and therfore prone to being unfair. To make a tax rate based on affordability or meaningfulness for different groups of people is to use subjective judgement. Who get's to decide what someone else can afford? What are the metrics? On the other hand, a flat percentage is objective.
Taxes are simply a by product of government.
To use any system of taxation is to apply subjective judgment, mraaron.
Flat tax is not objective. It is simple and easy, but the determination of it is neither more nor less objective than a system of graduated taxes.
The same folks get to determine what is affordable as get to determine at what point a flat tax would kick in or at what rate such a tax would be set.
Our current graduated tax system is unfair because it uses a higher rates for different groups whereas no other tax is based on ability to pay.
Ability to enjoy luxury items shouldn't be relevant to tax laws but yet this seems to be the primary logic of those in favor of a graduated tax system. If not this then how is a graduated tax system fair?
What you need to look at is this.
Taking from some of the numbers, some people at lower tax brackets pay 3% of their income in income taxes.
Those people at the 3% tax bracket do not have expendable income. They are truly living paycheck to paycheck and covering their living expenses. As are those that may be slightly higher, but not considered at the higer tax brackets.
Now.. lets say we make the flat tax 3% of everyones income.
First of all this country could not be funded on a 3% flat tax across the board. Granted our gov't spending needs to be reigned it, but we are at an all time high defecit (yes.. that is because of the war and other Bush policies on spending.. ) Even before this deficit a 3% tax across the board would not be sufficient for our gov't to function property to protect us from foreign invaders, for innovation etc.
So.. you would have to raise the %. How do you propose that people in a lower tax bracket who are already finanicially struggling and just able to pay their basics without much extras actually survive. Their meager incomes would then be taxed at what 10 or 15%?
That would put an extremely unfair burden on the lower and middle income brackets as they will then have to start sacraficing their needs and NOT their expendable income.
Middle income will be pushed to poverty.. working poor will be pushed even further down. Not enough money would be raised in taxes to take care of the working poor and the middle which is now poor etc.
You will find that there will no longer be a middle.. there will be poor and rich.
And the middle is the backbone of this country They are the ones that work as secretaries, in factories.. they ARE college educated people that make the wealthy companies run. Slide them into poverty and you will loose them.
The basic is this..the current tax structure allows for the middle class to be able to afford what they need.. and maybe here ore there get a few extras. Those below middle can still somewhat afford their needs.. but the those in the higher class still get their needs AND their wants despite their tax contributions to this country.
Of course individuals in higher income brackets are better off financially, isn't that the whole point of "moving up the ladder"? To try to remove this advantage through higher taxation is to undermine if not destroy our entire economic system. For if there is no increasing reward for: working harder, working smarter, being innovative, boosting efficiencies, then you remove one of the strongest motivators.
This argument seems to me to be built on a major fallacy.
Graduated taxes in the United States do not "try to remove" the advantage of being better off financially.
To the extent that there has ever been an increasing reward for all those things, there is still one - even if the only reward is financial.
The current federal tax rates are less progressive than they have been throughout the bulk of the last century.
This argument seems to me to be built on a major fallacy.
Graduated taxes in the United States do not "try to remove" the advantage of being better off financially.
To the extent that there has ever been an increasing reward for all those things, there is still one - even if the only reward is financial.
The current federal tax rates are less progressive than they have been throughout the bulk of the last century.
I mentioned removal of advantages in response to someone using one's ability to enjoy luxury as a method determining tax rate; as if there is something wrong w/ someone who can afford more. If the current graduated tax system does NOT do this, then i'd like to hear what is the rationale behind it? How is it fair?
I completely understand the challenge of matching current revenues w/ a new flat tax system, it wouldn't balance. The fact is our govt. has grown and is still growing and with that a growing tax bill ensues. For this reason the govt. will always continue looking for new revenues if left unchecked.
Every time I hear someone argue the "rich" don't pay their fair share I cringe because I don't see this as being true. I realize you haven't stated this JPS but I just wanted to mix things up a bit and raise the fairness question in the "other direction".
To pretend that a slight tax rate increase on higher brackets is going to solve problems is counter productive to many political discussions but I hear this all the time. Politicians love to talk about taxing higher brackets (because it's politically easy to do) but no one is bold enough to discuss cutting services or trying to run more efficiently.
Maybe this boils down each person's philosophy on govt. and its role. Should MORE money be trasferred from citizens to it's govt or less? What will be the consequence of each? The U.S. currently enjoys a smaller tax burden when compared to our GDP than most other devloped nations. Some Americans view this as a weakness while some view this as a strength. I personally see this as our strength. Our current problems are caused more by mis-management rather than a bad system.
I raised questions hoping someone would articulate the rationale and fairness of the existing system. So far I've only heard what the system isn't.
Why not a flat tax and then tack on a federal sales tax to existing state/local sales taxes? Then the rich still pay more taxes b/c they buy more stuff. Food/etc is not subject to sales tax. So everyone pays a flat tax, everyone buys food untaxed, and people who spend more money pay more taxes.
Taking from some of the numbers, some people at lower tax brackets pay 3% of their income in income taxes.
Those people at the 3% tax bracket do not have expendable income. They are truly living paycheck to paycheck and covering their living expenses. As are those that may be slightly higher, but not considered at the higer tax brackets.
Now.. lets say we make the flat tax 3% of everyones income.
TM - you may not realize it but, you are advocating income re-distribution - "taking" from those in higher income brackets (the so-called "rich") and giving the money (through benefits and programs) to the lower income brackets (the poor)
.......... but no one is bold enough to discuss cutting services or trying to run more efficiently.
Maybe this boils down each person's philosophy on govt. and its role. Should MORE money be trasferred from citizens to it's govt or less? What will be the consequence of each? The U.S. currently enjoys a smaller tax burden when compared to our GDP than most other devloped nations. Some Americans view this as a weakness while some view this as a strength. I personally see this as our strength. Our current problems are caused more by mis-management rather than a bad system.
This makes more sense than ANYTHING else in this thread. There is page after page about giving earned money to the government, but not one person up to this post has said anything about what the government does with the money it takes from any of us. If the government would reign in it's spending (and don't try to tell me they can't), then we can talk.
This is way out of my league, since I'm at the very bottom of the pile, but it's very obvious in the posts who has reason to sweat about higher taxes for the top percent of the population.
While you're throwing all those big numbers around, and talking about the right to climb to the top, think about this:
The fact that minimum wage doesn't support an adult trying to feed a family.
NONE of you would be in your positions without plenty of people holding your economic ladder up.
There are millions of people who work hard and don't have enough left in them to wrap their minds around getting ahead, they have all they can do to get by.
The list is endless.
My point: It's instinctual to protect your income and investments for those who can afford them, but it is for us on the bottom as well. It isn't jealousy, it's survival. On the lower end, any money coming in has to be micro-managed (What can I change for the next few months so my child can have something for Christmas.., Great, I have to furnish snacks for school, that means I can't get much more than hot dogs this week; things like that), so when you have enough to worry about the government taking more, no, it isn't fair they take more, but at least you have it to worry about.
Sometimes it isn't a question of wanting to make it better, it's a question of having something left in your heart to be able to make it better.
I mentioned removal of advantages in response to someone using one's ability to enjoy luxury as a method determining tax rate; as if there is something wrong w/ someone who can afford more. If the current graduated tax system does NOT do this, then i'd like to hear what is the rationale behind it? How is it fair?
Perhaps how I phrased it in a previous post wasn't properly stated..but I did flip it to what it should have read like. Yes, what luxuries one can afford should not be what determines how much tax a person pays.. there is nothing wrong with someone's ability to afford more. However, when the tax burdent starts eating away at a persons NEEDS then we have some issues to talk about. The fact that imposing a flat tax would, in essence, widdle away at the lower brackets ability to afford what they need is what really determines who pays the higher percentage in taxes. The fact of the matter is, any day of the week it is more just that someone's ability to say buy an extra car should be sacraficed for taxes as opposed to someones ability to feed their family.
I completely understand the challenge of matching current revenues w/ a new flat tax system, it wouldn't balance. The fact is our govt. has grown and is still growing and with that a growing tax bill ensues. For this reason the govt. will always continue looking for new revenues if left unchecked.
Every time I hear someone argue the "rich" don't pay their fair share I cringe because I don't see this as being true. I realize you haven't stated this JPS but I just wanted to mix things up a bit and raise the fairness question in the "other direction".
I don't think I've heard that the rich don't pay their fair share of taxes.. however, over the past 8 years we have seen the middle class continue to be squeezed to the point where they ARE sacraficing needs to make ends meet. The rich, however, do not have to sacrafice their needs and still have thier wants AND are getting a tax cut from the government... yet no relief for the middle class and the working poor. I think it's safe to say that those that are working hard yet still struggling have no sympathy or empathy for someone that has all their needs met, has all they want but is complaining about not having the tax breaks continued .. at a time where our government needs to close the deficit with tax revenue as well as decreased spending. You'll be hard pressed to get someone that is now cutting out some of their needs to make ends meet understand why someone that has excess is complainging. So their tax bill means that they can't afford a second "weekend" car or buy that third vacation home? I don't think I've ever heard the argument that the rich don't pay their fair share.. actually I just hear that the rich pay more and the lower tax brackets don't pay THEIR fair share from the rich.
To pretend that a slight tax rate increase on higher brackets is going to solve problems is counter productive to many political discussions but I hear this all the time. Politicians love to talk about taxing higher brackets (because it's politically easy to do) but no one is bold enough to discuss cutting services or trying to run more efficiently.
Absolutely 100% agree with this statement. Gov't needs to reign in on it's spending and they also need to mainstream a lot of the government programs like welfare, etc. .. be better at controlling corruption and waste. Oh.. and let's not forget getting ourselves out of a war we should never have been involved with in the first place.
Maybe this boils down each person's philosophy on govt. and its role. Should MORE money be trasferred from citizens to it's govt or less? What will be the consequence of each? The U.S. currently enjoys a smaller tax burden when compared to our GDP than most other devloped nations. Some Americans view this as a weakness while some view this as a strength. I personally see this as our strength. Our current problems are caused more by mis-management rather than a bad system.
I raised questions hoping someone would articulate the rationale and fairness of the existing system. So far I've only heard what the system isn't.
The bottom line is the gov't needs a certain amount of money to run itself. Yes, if we cut back on some of the waste and curtailed spending as it should be then yes.. we'd need less and therefore taxed less. The fairness is that when the gov't needs money it can't go to someone that doesn't have it to get it. It's not wise, smart or fare to take food off someone's table to meet gov't obligations.. so therefore the solution is to go to those that have excess for what the gov't needs to run this country.
I can agree 100% that we need to cut waste and that gov't needs to run a tighter ship.
TM - you may not realize it but, you are advocating income re-distribution - "taking" from those in higher income brackets (the so-called "rich") and giving the money (through benefits and programs) to the lower income brackets (the poor)
GreatDay.. this post and this thread is NOT only about welfare and governement programs. We are not talking about food stamps, WiCA, welfare and the like. We are talking here on a much broader scale.. the cost of running government including things we all benefit from.
And while I think we can all agree that there are those that abuse the welfare system, the fact is there are people that truly need it. And it benefits us all to aid our fellow citizens rather than leave them starving on a street corner or living like those in a third world country.. of which some of our population would without the assitance of government programs.
Not all taxes collected go to other people GreatDay but go to the betterment and protection of our nation.
Hmmm. Thank you for adhering to the "sprecial high standards" and for your evident devotion to the concepts underlying the Great Debates forum.
Quote:
Originally Posted by Greatday
Who actually benefits more from taxes being paid?
The taxpayer who doesn't have to go to jail for tax fraud. The IRS lawyer who doesn't have to put him there. The rest of the taxpayers who don't have to support the tax cheat while he or she is in jail and don't have to pick up the interest tab on what would have been borrowed to make up for what the tax cheat didn't pay...
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