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FLAT INCOME TAX:
This is a flat
17%
income tax ONLY on income ABOVE the poverty level. No one pays any tax on income BELOW the poverty level. All tax loop-holes and deductions are eliminated. CAPs on Social Security and Medicare are eliminated. All income (above the poverty level) is taxed the same flat 17%. |
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PROGRESSIVE INCOME TAX: This is an income tax in which the percentage increases as income increases. | |
| 17% INCOME TAX: | PROGRESSIVE TAX: | |||
| (01) | The 17% Income Tax (click here for details) is more fair than taxing at increasingly higher percentages as income increases (which is a the PROGRESSIVE tax system). The Flat Tax avoids the clear disincentive that plagues the Progressive Tax. The Flat Tax avoids the resentment fueled by that disincentive. Also, no one pays tax on income below the poverty level (regardless of their income). | (01) | The Progressive Tax is a clear disincentive to work and productivity, because the more you earn, the lesser percentage of your income that you get to keep, because of the increasing percentage of income that must be paid to taxes. This is the current tax system in the U.S. Unfortunately, the current tax system is also perverted beyond belief due to a myriad of deductions and tax loop-holes. Thus, the current tax system is effectively REGRESSIVE (meaning: as income decreases, the income tax rate increases). | |
| (02) | The 17% Income Tax reduces tax evasion because it is more fair, and no one is taxed on income below the poverty level. It is more simple and eliminates a lot of cost, time and waste. The increased simplicity reduces tax evasion, because complexity always increases corruption. More people will abide by laws if they are fair to start with. | (02) | The Progressive Tax is an inefficient way to increase the tax take, because of resentment, increased tax evasion, reduced incentive to work and administrative complexities, a progressive tax rate can actually lessen rather than increase the total tax take, which is in nobody’s fiscal interest. | |
| (03) | The 17% Income Tax doesn't hammer high income earners (as does the Progressive Tax). | (03) | The Progressive Tax is unfair to high earners, since they are the least likely group to benefit from much taxpayer-funded activity (e.g. welfare). | |
| (04) | The 17% Income Tax is less of a form of large-scale income redistribution (less than a Progressive Tax). It does not simply push the burden of funding government activities higher up the income chain in larger amounts and onto fewer people. | (04) | The Progressive Tax is a form of large-scale redistribution. It simply pushes the burden of funding government activities higher up the income chain in larger amounts and onto fewer people. | |
| (05) | The 17% Income Tax does not weight one group more heavily than others (as does a Progressive Tax system). Thus, the risk of lost or unpredictable revenues is less with a Flat Tax than with a Progressive Tax system. | (05) | The Progressive Tax is unwise because the concentration of taxation amongst a smaller group of taxpayers introduces a higher risk of a more pronounced drop in tax revenues (e.g. in a recession). | |
| (06) | The 17% Income Tax can not encourage talented workers who earn high incomes to move overseas to escape the tax system. It does not fuel the "brain drain". Workers are not less motivated to be more productive and creative. | (06) | The Progressive Tax can encourage talented workers who earn high incomes to move overseas to escape the tax system. This can create a "brain drain". Alternatively, as the marginal benefit of extra work falls, they are less motivated to be more productive and creative. High progressive taxes may encourage emigration because taxes are not internationally harmonized, so very high earners are sometimes able to relocate to pay less tax. | |
| (07) | The 17% Income Tax does not discourages high incomes since the rate is the same for everyone on income over the poverty level. an increasing percentages goes to the government. Wages are a reward for work done which are largely a private matter between the employer and employee. The Flat tax does not undermine that. | (07) | The Progressive Tax discourages high incomes since an increasing percentages goes to the government. It is not the role of government to use tax policy to determine an acceptable wage, but that is effectively what it is doing. Wages are a reward for work done which are largely a private matter between the employer and employee. The Progressive Tax undermines that. | |
| (08) | The 17% Income Tax is based less on arguments related to welfare economics. | (08) | The Progressive Tax is essentially based on arguments related to welfare economics. | |
| (09) | The 17% Income Tax does not discourage saving as much the Progressive Tax does. | (09) | The Progressive Tax discourages saving. | |
| (10) | The 17% Income Tax is moral because it is fair. It's doesn't fuel the politics of envy and jealousy. Few can say it isn't fair, unless they are trying to disguise envy and jealousy as demands for equality. | (10) | The Progressive Tax fuels the politics of envy and jealousy, because it is inherently unfair, and therefore, it is immoral. It encourages those with envy, jealousy, and a sense of entitlement to disguise it as demands for equality. A government which robs Peter to pay Paul can always depend on the support of Paul. | |
| (11) | The 17% Income Tax has no bracket creep since the rate is the same flat 17% ONLY on all income above the poverty level. | (11) | The Progressive Tax has bracket creep which occurs when the amounts are not tied to the cost of living. Due to inflation tax rates would thus slowly rise. | |
| (12) | The 17% Income Tax will increase trust in the government due to their clarity. | (12) | The Progressive Tax does not increase trust in the government, since it is unfair, complex, immoral, and empowers those seek to disguise their envy, jealousy, and a sense of entitlement as demands for equality. | |
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(13)
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The 17% Income Tax will increase tax revenues, by simplifying the tax code and removing the many loopholes corporations and the rich currently exploit to pay less tax. For example, the Russian Federation increased real tax revenues from its Flat Personal Income Tax. Revenues rose by 25.2% in the first year after the Russion Federation introduced their Flat Personal Income Tax. The real tax revenues increased by 24.6% the second year, and increased by 15.2% the third year. The Laffer curve predicts such an outcome, but also attributes a significant portion of the greater revenues to higher levels of economic growth too. |
(13)
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The Progressive Tax results in lower tax revenues due to more complications, the disincentives to work more, and the myriad of tax deductions (as in the current system). | |
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(14)
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Poll reports most Americans say current tax system is unjust. A big part of the problem is the ridiculously complicated myriad of deductions and tax loop-holes. The 17% Income Tax would remove all of those tax deductions and tax loop-holes. |
(14)
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Poll reports most Americans say current Progressive Tax system is unjust. A big part of the problem is the ridiculously complicated myriad of deductions and tax loop-holes. The Flat Income Tax would remove all of those tax deductions and tax loop-holes. But also, many people believe that a system that increases the tax percentages for those that earn more is unfair, and discourages productivity, and encourages tax evasion. | |
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EXAMPLE of 17% Flat
Tax (with low-income level deduction of $8K):
Neutral,
Progressive, and
Regressive
Taxes (click
here to enlarge chart below):
