January 6, at 4: My genes belong to me lucky or unlucky, they make up who I am. I see no difference between being asked to give up the fruits of my labor genes for the purpose of leveling the playing field and being asked for the generous supply of eggs in my ovaries. My luck belongs to me.
That is an subtle but important difference. If those with lower incomes had more money to pay in taxes, they would, you know, not be poor. Likewise, the middle class is often extended on credit. There really is only one class with the ability to pay higher taxes, that is those with higher incomes and more wealth.
This is why a progressive tax makes more sense in general. The devil is of course in the details, as loopholes and the placement of brackets matter greatly HINT: When we consider that some are making tens of millions and others billions, and most of that is in capital gains, we can affirm that there are more pressing problems in terms of fairness than the income tax.
Considering Ability to Pay and Total Tax Burden Above we covered the basics, below we will explore each aspect discussed above.
When we take into account all tax types, we can say: Federal taxes are progressive on aggregate as you can see in the Tax Policy Center images belowbut the progressive federal Income tax is essentially the only thing ensuring this under our current system. If we flatten that tax, then lower incomes are squeezed even harder… while higher incomes get a tax break.
With all of that said, there are some valid lines of reasoning regarding the logic behind a flat tax and its fairness. The argument above generally applies to federal income-related taxes.
So it applies to the federal income tax, the federal capital gains tax, and the federal corporate income tax. See an argument for the estate tax. It is one of the only taxes that addresses the wealth gap!
Just take another look at the Tax Policy Center charts above and below. Ideally taxation should be progressive, subsidization regressive tapering off slowing, avoiding cliffsand otherwise as simple as possible while remaining fair.
Of course, this assumes the underlying problem is tax structure alone. Under a flat tax wage earners are taxed twice income and payroll and dividends only once income. Pair this with the fact that payroll, property tax, and sales tax are already somewhat regressive and flat as the more you make the less they hurtand the flat tax argument gets that more difficult to make.
Since there is a cliff, where when you make more you pay less, the tax can be described as regressive. This tax burdens lower-incomes more than higher ones accordingly. Same would be true for a flat income tax. A Modified Flat Tax: When we compare these modified flat taxes to our current progressive tax system loopholes and allthe conversation gets more complex.
Crash Course Economics This video by PBS has economists look at progressive, regressive, and flat taxes, and how those and other taxes affect America and the world.
This is probably the best tax video online. So it is a must watch. Unless you studied economics or do the books for businesses, this video will be eye opening.
A Progressive Income Tax Vs. Which is More Fair? The result being those who can afford to pay more do. At best this incentivizes trickle down economics, at worst it just means less income for the U. The average American pays an income tax rate of An excessively progressive tax would also be unfair.
I believe a tax that perfectly followed the sloped demand curve for money would be the most fair. Oh, finally, the other argument for progressive taxes is that rich people also get the most benefit from things paid for by taxes.
In this sense, the tax merely fills in for the missing market. These arguments do not get us to a precise tax rate. But they do suggest a case for some degree of progressivity in the taxes. And let’s be clear. A 50p tax is not massively progressive.
Overall revenues are equal to just over 37% of GDP.
Free Essay: Progressive Income Tax Fairness The issue of federal income tax policy has been one of hot debate and controversy for many years.
Discussions and. The Benefits of Progressive Taxation Essays Words 8 Pages Thousands of years ago, in ancient Athens, the city was relatively a paradise, they had civilization, they had theater, they had the arts; they also had an absolute flat .
A progressive tax is a tax in which the tax rate increases as the taxable amount increases. The term "progressive" refers to the way the tax rate progresses from low to high, with the result that a taxpayer's average tax rate is less than the . A progressive tax is one in which upper-income families regressive Taxes Poor rich ProPorTional Taxes Poor rich Progressive Taxes u u u t u CHAPTER ONE Tax Fairness FundamenTals “T he subjects of every state ought to contribute toward the support of the government, as nearly as possible, in proportion to their respective abilities.