IS IT TIME FOR A FLAT TAX

Now that Tax day is behind us I have been thinking about that statement I read in the paper the other day which stated that something to the effect and I am not positive of the numbers, but something like 45% of Americans do not pay any taxes, leaving the remaining 55% to pay them for everyone. Isn't it time for a flat tax where everyone pays the same percentage of their income, regardless of how much money they make. Is this not the fairest way to collect taxes. You would generate more in total revenue, and you could eliminate many positions within the IRS cutting federal spending. I am not sure what the correct percentage would be, but lets say 10%. So whether you make 10 dollars or 100 million dollars your tax liability is 10 percent of that amount. There would be no need for tax returns, because this could be handled by your employer, because their are no exemptions there is not need for tax prep people. I think the time has come. If the only reason we are keeping this old outdated tax collection system is that it is now an industry that employees people would we not be better off in the long run to institute a flat tax and more on.

+1 brazilian!...I mean, bazillion!

This idea has been floated around for years as an alternative to the progressive income tax structure now in place. Basically, on April 15, you would fill in a postcard with this information:

What did you earn?
Multiply by 10 percent
Pay this amount

Unfortunately, so many special interest groups have their tentacles wound around the tax code and the Congress which makes the simplistic tax return almost impossible. First, you'll have the housing industry up in arms about the demise of home ownership because mortgage interest would no longer be deductible. Then, charities will state that they'll lose money due to the inability of people to deduct donations. Then, advocates for lower-income individuals will say that this impacts a segment of society that is unable to afford to income taxes. Not to mention this would boost Obamacare because medical expenses would no longer be deductible.

I am all for the flat tax in theory. It would take a Congress and a President with enough courage to withstand the barrage of protests. This group ain't it.

The politicians fear a flat tax or a "fair" tax would initiate mass riots.

What most of us do not understand is that nearly 40% of the population receives direct money from the government, without paying any Federal Income Tax (they DO pay FICA and MediCare). A family of four, with two children under 18, making $30,000 AGI is eligible for a $5657.00 Tax REBATE (EIC), if they file to claim it. (The income limit is $48,269 for married with more than two kids, but the rebate is less as they approach that limit).

This means that, even though they do not pay any income tax, they can get a refund of over $5000 as a "reward" for working instead of drawing Welfare.

Add in the 5% currently on Welfare, plus the now nearly 1% in Prison, and that's a lot of dollars the rest of us are handing out to our neighbors, courtesy of the US tax system.

Check the IRS web site and you will find that 50% of the population (the poor) pay less than 2% of all taxes, and less than 2% of the population (the very rich) pay more than 50% of the total tax collected.

The remaining 48% of us pay the remaining 48% of all taxes.

I do not see how this is sustainable, given our current federal deficits, and I don't see significant changes being peacefully accepted by those who, from my viewpoint, are not paying their fair share of the burden or draw from the pool without any contribution.

There's the nut of the issue, and it's surely in the jaws of the vise now.

There are probably some of you that want believe we don't live in a socialist nation. Yeah, right.

Enjoy.

The "Fair" tax proposal seems to get the most attention these days. The concept is that you have what amounts to a national sales tax.

You don't file income tax statements. If you make money illegally and don't report it under the current system, you get taxed when you spend your money under the fair tax. There's a whole lot of good things about the "fair" tax.

The big problem I see is that the congress would never be able to keep their hands off of it. They'd decide that it needed some "enhancements" to make it "fairer." At some point, they'd claim that the "ultra rich" weren't paying enough and they'd institute some sort of "windfall profits" tax or some other politically correct term that amounts to a new income tax. They'd set some "very high" income level that it applied to. Then inflation would jack up everyone's income bracket and everyone would fall under the "ultra rich" taxable category. Sort of like how the Alternative Minimum Tax was only supposed to affect the ultra rich. Even the US federal income tax was supposed to only affect the rich.

A key part of the fair tax is that you wouldn't tax businesses directly. The businesses would be taxed when they pay money out to their shareholders and the shareholders get taxed when they spend the money. Under the current system we "tax" businesses and they simply pass that tax along to their customers by increasing their prices. You, the citizen are still paying the tax, but you don't see the tax itemized anywhere. It's funny when the left wingers want to tax businesses to "protect the little guy" because business taxes hit all citizens equally when they buy goods. It's essentially a "regressive" flat tax on the citizens, not on the "fat cats."

Congress would never be able to resist the temptation to restart a tax on businesses because it's a way to steal money from the voters without them realizing it.

I like the concept, but it would take us a long time to wean ourselves from a progressive income tax. Presently, we rely on the wealthier 53% of the population to foot the bill for the poorer 47%. The flat tax would eliminate that, and seriously degrade the buying power of the poorer 47%. I don't know how EIC would be put into the mix either.

It would take a long term commitment, perhaps over a period of ten years, from members of both parties, to make it work. Right now, I have no confidence that that commitment is in place.

Also, with trial balloons for VAT floating around, I am afraid of some perverted confluence of the two ideas, which results in both an income tax and a national sales tax.

I've always been in favor of a flat tax as it appears to be the most fair tax system. The thing with being taxed in any system is that people don't like to pay them (include me in that group) so there will always be someone who tries to figure out a way not to pay.

What our "intelligent" politicians fail to realize is that taxes are dynamic and not static so that the more someone is taxed, the more that person will figure out ways not to pay. A flat tax with a low rate of somewhere between 10% and 17% would actually bring in more taxes because people would have more money in their pockets and would thus have more disposable income. When we have more disposable income we are more likely to purchase items that we've been wanting. More sales means that companies need to hire more people which leads to more income tax. Simple, IMHO

We have a flat tax already. It's called FICA and only applies to those making under $106,800 for 2010. It is comingled with the rest of the tax collections we pay and not used for it's intended purpose. Bush used the excess collections under FICA to argue for reduced income tax rates, but the surplus was really from excess FICA collections, and those wages to which those apply continue to go up each year.

We have a flat tax already. It's called FICA and only applies to those making under $106,800 for 2010. It is comingled with the rest of the tax collections we pay and not used for it's intended purpose. Bush used the excess collections under FICA to argue for reduced income tax rates, but the surplus was really from excess FICA collections, and those wages to which those apply continue to go up each year. Originally Posted by KCJoe

They just can't control themselves, no matter what the topic is Bush has to be brought into it. FICA has nothing to do with changing the tax system for the country. Can we just agree that Bush is the cause of all the wrongs in the world, still born baby's, rapes, murders, the economy, war and all of the evils in the world. Now with that out of the way can an intellegent coversation occur that does not have to revert to some type of Bush bashing. I mean Jesus Christ, you won, okay let Bush and Palin go and discuss the merrits of the decisions made by the administration from this date forward. okay you have slayed the dragon and save civilization from the evil fire of his breath.

How many years did we have to hear from the right how Clinton was the reason Bush had so many problems to deal with.

"How many years did we have to hear from the right how Clinton was the reason Bush had so many problems to deal with."

I dont know, I have never said anything of the sort. So this is some kind of childish game of "they did it to us, so we're doing it back", this sounds so typically liberal/progressive.

Flat taxes well maybe it might work just maybe. But as always i will say this those poor people who don't pay taxes normal work for those rich people who do pay taxes & don't works as hard as those poor people. Its a give & take.

How many years did we have to hear from the right how Clinton was the reason Bush had so many problems to deal with. Originally Posted by KCJoe

Actually, Joe - while this may be off-topic - the only thing I heard regarding passing blame to Clinton was letting Obama Osama (as Ted Kennedy liked to say) go after he was captured in the mid 90's - which may or may not have prevented 9/11. You heard very little criticism of previous administrations from Bush 43. It doesn't mean that other conservatives didn't heap criticism on Clinton during Bush 43's administration both in the Congress and in the media. Unlike the Bamster, Bush 43 had the class to address any problems/issues that may have manifested during previous administrations by addressing the issue and not blaming others - albeit sometimes unsuccessfully.

Now - back on topic

I specifically remember an interview of the senior Bush in the early nineties. The reporter asked him a leading question...and Bush stopped him. He said "I didn't lose the election to become my successor's biggest critic". He absolutely refused to criticize Clinton.

"for those rich people who do pay taxes & don't works as hard as those poor people"...

I come into contact with a few rich people in my dealings at work. They are incredibly driven, incredibly hard working, and never seem to quit working. I don't know why popular culture has created this myth that rich people in this country don't work hard for their money.

"I come into contact with a few rich people in my dealings at work. They are incredibly driven, incredibly hard working, and never seem to quit working. I don't know why popular culture has created this myth that rich people in this country don't work hard for their money."

Because in their mind rich is Hollywood where a successful actor my work once a year and then hang out the rest of the year. Besides that how years of class warfare by the liberals have painted them.