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Originally Posted by irateplatypus
my biggest problem with your idea is that someone decides what is "plenty enough to live on." i don't recognize anyone's right to determine that for me.
other than that little gripe, i'm not certain why this structure is markedly different from the one already in place save the shifting of zero tax liability to a higher income strata.
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By "plenty to live on," I mean enough to survive in reasonable conditions. That is the same for everyone. You're not going to be homeless on the street and starving if you can't afford three new PS2 games a week. Anyway, the point is not that the exemption should be the exact amount you need to survive, I'm just saying the exemption is sufficient such that people with a lower income should have nothing to complain about.
How it's different from the current structure is that it's EXTREMELY simplified. This is one of the major reasons always cited by Republicans who want to shift to a flat tax (and whether my model is a flat tax by definition, I don't know and it doesn't matter, I just meant there is only one tax rate). No more exemptions (other than the one), deductions, and you don't need to be a tax attorney to do your own taxes.
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Originally Posted by Redlemon
One big reason that it would be difficult to enact a flat tax is that Congress likes to encourage certain behaviors via tax exemptions. Things like owning a house and having children give you tax breaks. Whether or not this is an appropriate use of the tax system is another question entirely.
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Of course this is true and might be the largest obstacle. But those Republicans with the flat tax don't seem to care too much about it either.
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Originally Posted by pan6467
The problem with tax "curves" is yes the very poor pay less of a percentage but so do the very rich... it's the people in the middle that get squeezed out.
Look I'm sorry if I'm making 5 million and taxes take out 1/2 so that there will be better schools, healthcare and social programs for the poor then it is my duty. 2.5 million is still a hell of a lot for me to live on. And if I can't live on that then the problem lies within ME not the tax system.
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Originally Posted by mazagmot
If you figure in sales taxes, I wouldn't be surprised if the actual amount paid in taxes, as a percentage, is higher for the bottom 10 or 20 % of our population than it is for the top 10%. They can afford accountants who can find all the loop holes and offshore bank accounts/corporations/tax shelters.
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Exactly, as the system is now, the rich are not paying anywhere near thirtywhatever percent of their actual income to the IRS. I believe the number cited for the Kerrys during last year's campaign was that they paid 18% of their income in income tax. Further, I would be surprised to find that this system would increase the tax burden on the middle class, but if anyone has the numbers to show it I might think otherwise. Certainly the numbers could be tweaked such that it didn't: If you had say a $60,000 exemption and a rate of 80% I don't think you could say that the middle class are worse off since someone making the median income pays, again 0%. Then I would say the rich have too much of a burden. That's another thing I think is great about this system, it's much easier to make effective changes to it.