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This thread has done a pretty good job of staying on topic and not resorting to name calling as many other threads in the politics forum tend to do. I guess it is because we are all in the same boat, stuck with a tax system that doesn't work and looking for better alternatives.
I would support a flat tax with a reasonable minimum level under which no tax is paid. I don't support the idea of increasing that level for people who choose to have dependents. That kind of a system is a little too pro-breeding for me.
My preference though would be for a national sales tax (or VAT if you prefer). Some previous posters in this thread have made valid points on both sides of the debate. I have a couple of points to add to the discussion. One of the points that was missed is that there are already essential goods that are excluded from sales tax. Thus the burden on the lower income family would be quite limited. Groceries, rent, health care... all exempt from sales tax. You don't pay sales tax when you buy a house either, so there is no impediment to purchasing your own home (one of the key paths to wealth). You would only pay out extra on taxable items... dining out, clothes, cars, travel, luxury items, etc. So the lower income family struggling to get by would not have to struggle any harder to put food on the table or pay the rent. Sure, they still have to buy clothes and a table to put the food on, but those costs are not monthly recurring essentials. Also as the point was raised earlier, if the VAT reduced businesses costs for these items they might costs only marginally more.
The middle income families would also not be put out by a VAT because they would retain more of their income to spend as they like. Their discretionary income would increase, so the economy would not be injured by reduced consumption. Likely most people would continue to live their lives as they do now. The upper income bracket would also continue to spend as they are accustomed. They might like the idea least, as more of the tax burden is placed on those who consume more, but that is the whole idea.
The second point I'd make in this debate is that a VAT reduces loopholes and potential tax shelters so that the burden of tax is more fairly applied across all socioeconomic classes. If you want more taxable goods, you pay more tax. Surely there would be those who would try to avoid the system... buying a luxury auto overseas comes to mind, but I don't see that as being too difficult to enforce.
Another benefit of the VAT system is that it is possible to largely reduce your personal tax burden if you so choose. Say that I am a thrifty person of middle income (which I happen to be). I would like to save more of my money for retirement and reduce my current tax burden. Easy... I just spend less on taxable items. I don't buy that new car, I don't pay tax on that new car. I don't buy a new wardrobe for fall, I don't pay tax there either. If I try to reduce my tax burden under the current system, I could be thrown in jail.
Ok, I've said my piece. Shred my arguments as you see fit.
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