what is wrong with a flat tax?

michaelcassiomichaelcassio Posts: 72
edited August 2007 in A Moving Train
could someone make it perfectly clear to me what is wrong with a flat tax? not only is it simple, it's entirely fair. are any of the candidates proposing or supporting this system? i can't remember any of them discussing it specifically.
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  • Uncle LeoUncle Leo Posts: 1,059
    I would be willing to consider a flat tax. However, every proposal I have heard of does not want to count investment income, but just labor. I don't feel labor should be taxed while investment is not.

    I don't think the flat tax is going to take off any time soon because most either want to keep the tax approximately as is or they want a national sales tax. In 20 years I will not be stunned if there is a national sales tax
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  • ZanneZanne Posts: 899
    Consider this:

    A minimum wage worker. We'll make up numbers for ease of calculation, please know that I realize a minimum wage worker doesn't make 10.00 per hour.. but I will use that figure for ease.

    A business executive. Let's give him 100.00 per hour.

    Let's say the flat tax is 10 percent of the income.

    The minimum wage worker, who desperately needs every penny he can get his hands on, has a take home pay of 9.00 per hour.

    The business exec has a take home pay of 90.00 per hour.

    Does it seem more fair than a progressive tax?

    I think what really needs to be looked at is the tax breaks that our government gives to huge corporations. There have been stories of some actually paying a negative tax after all the write offs.
    Just me
  • Bu2Bu2 Posts: 1,693
    What if we put higher taxes on the income (salaries) of the rich, and gave tax breaks to the people with lower incomes (salaries), and put a flat tax on their respective inheritances and windfalls and other means of investment income?
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  • jeffbrjeffbr Seattle Posts: 7,177
    Zanne wrote:
    Does it seem more fair than a progressive tax?

    It absolutely does. That's the point. Everyone pays the same percentage, and success isn't penalized.
    "I'll use the magic word - let's just shut the fuck up, please." EV, 04/13/08
  • hippiemomhippiemom Posts: 3,326
    jeffbr wrote:
    It absolutely does. That's the point. Everyone pays the same percentage, and success isn't penalized.
    Everywhere I look, I see successful people living dramatically better than their less successful counterparts, so it doesn't seem to me that they're being penalized to any great extent. I don't feel penalized, and I can assure you that our tax bill is anything but small. I DO feel ripped-off to see my money being spent the way that it is. If spending priorities changed, I wouldn't mind paying the same amount. My family has enough money after taxes to live quite nicely.

    I can't say what is wrong with a flat tax, because I've seen many different proposals and I don't know which one we're talking about. I have seen some that I do think are worthy of serious consideration. I definitely agree that our tax system needs a major overhaul, so I'm not willing to rule out any form of a flat tax. It could quite well turn out to be much better than what we have now.

    What I'd really like to see is a tax that everyone has to actually PAY, rather than having it disappear from their check, or in the case of a national sales tax be an invisible mark-up on the goods we buy (much as the gas tax is now). If people had to actually send their tax payment in themselves, maybe they'd start paying more attention to how our money is spent.
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  • LikeAnOceanLikeAnOcean Posts: 7,718
    It's argueable.. you can work hard for your money, or hardly work for your money.. just because you earn a million a year, does it really mean you earned it all?.. I say tax those mothafuckas.. the system is corrupt.. had you asked me the question 10 years ago I would have agreed with the flat tax.. now I say, tax those rich fuckers for every extra dime they didn't really earn!.. they get witty and play with the extra money, they never really earned it..
  • spiral outspiral out Posts: 1,052
    jeffbr wrote:
    It absolutely does. That's the point. Everyone pays the same percentage, and success isn't penalized.


    A flat tax just steals even more money from the poor, and i really don't see that as a good thing.

    Over here they have 10% for the lowest payed and the next bracket is 22% now they are going to change it to a flat 20% so all those people in part time jobs or whatever have effectively had there tax doubled. Now explain to me how that is a good thing.

    In your idea success isn't penlised but being poor is.

    I personally am happy to pay more tax, then have the poorest better off on benefits than working, it's just plain wrong.
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  • spiral outspiral out Posts: 1,052
    It's argueable.. you can work hard for your money, or hardly work for your money.. just because you earn a million a year, does it really mean you earned it all?.. I say tax those mothafuckas.. the system is corrupt.. had you asked me the question 10 years ago I would have agreed with the flat tax.. now I say, tax those rich fuckers for every extra dime they didn't really earn!.. they get witty and play with the extra money, they never really earned it..

    Ah so true, lets tax the rich. We need a revolution.
    Keep on rockin in the free world!!!!

    The economy has polarized to the point where the wealthiest 10% now own 85% of the nation’s wealth. Never before have the bottom 90% been so highly indebted, so dependent on the wealthy.
  • OutOfBreathOutOfBreath Posts: 1,804
    What is wrong is that while the poorest can't part with the money necessary to pay the flat tax, while the rich won't even notice it. As someone pointed out, there's a big difference on flat 20% tax on incomes 10$ an hour and 100$ an hour. It shifts the tax burden over on those that can afford it the least, the lower brackets.

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  • AbuskedtiAbuskedti Posts: 1,917
    could someone make it perfectly clear to me what is wrong with a flat tax? not only is it simple, it's entirely fair. are any of the candidates proposing or supporting this system? i can't remember any of them discussing it specifically.

    implementation of a flat tax is the repeal of billions in social programs. It is not simple at all. A flat tax would serve to shine a light on those progrms - and that is perhaps a good thing.. but very difficult politically. Our current government is just not up to such a task
  • know1know1 Posts: 6,794
    Zanne wrote:
    Consider this:

    A minimum wage worker. We'll make up numbers for ease of calculation, please know that I realize a minimum wage worker doesn't make 10.00 per hour.. but I will use that figure for ease.

    A business executive. Let's give him 100.00 per hour.

    Let's say the flat tax is 10 percent of the income.

    The minimum wage worker, who desperately needs every penny he can get his hands on, has a take home pay of 9.00 per hour.

    The business exec has a take home pay of 90.00 per hour.

    Does it seem more fair than a progressive tax?

    Yes - it does seem more fair. The business exec is making 10 times as much and is paying 10X as much taxes.

    The government collects too much tax money anyway.
    The only people we should try to get even with...
    ...are those who've helped us.

    Right 'round the corner could be bigger than ourselves.
  • IndifferenceIndifference Posts: 2,725
    know1 wrote:
    Yes - it does seem more fair. The business exec is making 10 times as much and is paying 10X as much taxes.

    .

    Exactly.

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  • RainDogRainDog Posts: 1,824
    know1 wrote:
    Yes - it does seem more fair. The business exec is making 10 times as much and is paying 10X as much taxes.

    The government collects too much tax money anyway.
    While numbers and math are cold and factual, money and wealth are relative. If you believe in the flat tax, you believe in taking the "burden" (with quotes) off the rich (who benefit most from our society) and placing that burden (no quotes) on the poor (who benefit least from our society). And, if you incorporate some sort of exemption for the poor, all you've done is reduce government funding, which will in turn reduce social programs that benefit the poor you've exempted - far more than a $10 rebate.
  • Pacomc79Pacomc79 Posts: 9,404
    because of the endless reforms and codes that will inevitably be dumped in in the later years winding up with a tax code that looks remarkably like the one we have now. Lobbiests, corporations, special interest groups all want exemptions etc etc.

    That's why I'm not a big fan of the Flat Tax, it works for all of maybe one year before it's "reformed" Then we have the same issue, a big hulking complicated pile of gobbledy gook.

    I think a simpler system would be be for the benefit of all.

    No one should need an accountant to do taxes.
    My Girlfriend said to me..."How many guitars do you need?" and I replied...."How many pairs of shoes do you need?" She got really quiet.
  • bootlegger10bootlegger10 Posts: 16,053
    jeffbr wrote:
    It absolutely does. That's the point. Everyone pays the same percentage, and success isn't penalized.

    The poor aren't going to want to start paying taxes.
  • bootlegger10bootlegger10 Posts: 16,053
    Pacomc79 wrote:

    No one should need an accountant to do taxes.

    Then I would lose my job. I could go for this.
  • Royals32Royals32 Posts: 160
    It's argueable.. you can work hard for your money, or hardly work for your money.. just because you earn a million a year, does it really mean you earned it all?.. I say tax those mothafuckas.. the system is corrupt.. had you asked me the question 10 years ago I would have agreed with the flat tax.. now I say, tax those rich fuckers for every extra dime they didn't really earn!.. they get witty and play with the extra money, they never really earned it..


    I'm not really sure what that means. If I make a million dollars this year, it's because I earned every penny of it.
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  • surferdudesurferdude Posts: 2,057
    There's nothin gwrong with a personal flat tax, especially if there's a decent income threshold before it kicks in. Say a flat tax rate of 15% but your first $25,000 is tax excempt but zero deductions after that. This ultimately makes the tax a little progressive which I believe taxes should be but it also makes taxes easy eneough that you don't need an acountant. As good an idea as it may be it will never happen as it does not pander to special interest groups. I don't think a flat tax is feasible for business though.
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  • Dustin51Dustin51 Posts: 222
    The thing that makes me think a flat tax is a good idea is that our government seems to be unwilling to consider it. If they dont want it then it must have some merit.
    I understand what some of you are saying, generally speaking anytime something is sold to the public as being fair it's because someone is getting screwed over.
    I think the biggest advantage to it is that we could effectively dissolve the IRS. Everyone who wants a progressive tax must also understand that, that requires policies and procedures that must be overseen by some governing body because some one has to decide what income is considered poor, whats middle class, and what's wealthy which is what the IRS does now. So I definietly see that an arguement can be made on either side.
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  • Pacomc79Pacomc79 Posts: 9,404
    Then I would lose my job. I could go for this.


    There are plenty of better uses for your skills than fussing with taxes and tax codes. I'm sure you would do very well investing money.
    My Girlfriend said to me..."How many guitars do you need?" and I replied...."How many pairs of shoes do you need?" She got really quiet.
  • know1know1 Posts: 6,794
    RainDog wrote:
    While numbers and math are cold and factual, money and wealth are relative. If you believe in the flat tax, you believe in taking the "burden" (with quotes) off the rich (who benefit most from our society) and placing that burden (no quotes) on the poor (who benefit least from our society). And, if you incorporate some sort of exemption for the poor, all you've done is reduce government funding, which will in turn reduce social programs that benefit the poor you've exempted - far more than a $10 rebate.

    How do the rich benefit most from society if they're paying more in taxes and receiving none (or very little) of the social programs?
    The only people we should try to get even with...
    ...are those who've helped us.

    Right 'round the corner could be bigger than ourselves.
  • know1know1 Posts: 6,794
    The poor aren't going to want to start paying taxes.

    Nobody wants to pay taxes.
    The only people we should try to get even with...
    ...are those who've helped us.

    Right 'round the corner could be bigger than ourselves.
  • know1know1 Posts: 6,794
    surferdude wrote:
    There's nothin gwrong with a personal flat tax, especially if there's a decent income threshold before it kicks in. Say a flat tax rate of 15% but your first $25,000 is tax excempt but zero deductions after that. This ultimately makes the tax a little progressive which I believe taxes should be but it also makes taxes easy eneough that you don't need an acountant. As good an idea as it may be it will never happen as it does not pander to special interest groups. I don't think a flat tax is feasible for business though.


    People could get a credit for "food, clothing, & shelter" based upon number of dependents, and after that the flat rate kicks in.
    The only people we should try to get even with...
    ...are those who've helped us.

    Right 'round the corner could be bigger than ourselves.
  • Pacomc79Pacomc79 Posts: 9,404
    know1 wrote:
    How do the rich benefit most from society if they're paying more in taxes and receiving none (or very little) of the social programs?


    Security, Protection of Commerce, Fire, Police, transportation etc.
    My Girlfriend said to me..."How many guitars do you need?" and I replied...."How many pairs of shoes do you need?" She got really quiet.
  • know1know1 Posts: 6,794
    Pacomc79 wrote:
    Security, Protection of Commerce, Fire, Police, transportation etc.

    I didn't realize those weren't offered to the poor... ;)
    The only people we should try to get even with...
    ...are those who've helped us.

    Right 'round the corner could be bigger than ourselves.
  • RainDogRainDog Posts: 1,824
    know1 wrote:
    How do the rich benefit most from society if they're paying more in taxes and receiving none (or very little) of the social programs?
    In addition to what Pacomc79 said, there's also the structure of our society itself. It's markets, it's wares, the fact that it's reasonably open, makes it very benefitial to those who have money, and those who have the means to make money. What the rich recieve aren't so much the social programs themselves, but the stable society that social programs help keep a float - a society where the rich (and just about anybody - within reason, of course) can make and continue to make money.
  • Pacomc79Pacomc79 Posts: 9,404
    know1 wrote:
    I didn't realize those weren't offered to the poor... ;)


    indeed, I meant, if you're destitute, you maybe don't care so much about property rights because you have none to protect or value life...etc.

    The money we pay in taxes creates that structure that makes society safe for people to operate.
    My Girlfriend said to me..."How many guitars do you need?" and I replied...."How many pairs of shoes do you need?" She got really quiet.
  • DCGARDENDCGARDEN Posts: 515
    If you're talking about a rate of tax in which the millionaire motherfuckers should be taxed to help out the minimum wagers, then tax Eddie Vedder and Sean Penn untill they vote Republican

    If you're talking about taxing someone who makes 65-70K a year to help out the less fortunate, then that is where it gets difficult for me to support. People making this amount are not rich. People making this amount may have 4 or 5 children that they want to send to college and are working their asses off, owning a restaurant or deli, to do so. To have the government come in and take their dough to help out someone who needs it too, is a fucking disgrace.
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  • RainDogRainDog Posts: 1,824
    DCGARDEN wrote:
    If you're talking about a rate of tax in which the millionaire motherfuckers should be taxed to help out the minimum wagers, then tax Eddie Vedder and Sean Penn untill they vote Republican

    If you're talking about taxing someone who makes 65-70K a year to help out the less fortunate, then that is where it gets difficult for me to support. People making this amount are not rich. People making this amount may have 4 or 5 children that they want to send to college and are working their asses off, owning a restaurant or deli, to do so. To have the government come in and take their dough to help out someone who needs it too, is a fucking disgrace.
    So people making 65-70k a year should be exempt from taxes? We'll have to disagree.

    Besides, in a society that has a progressive tax structure, millionaires like Eddie Vedder and Sean Penn pay a higher tax rate than the restaurant owner anyway. In fact, if that 65-70K per year restaurant owner has 4 or 5 kids, chances are he or she is getting a tax break in addition to paying a lower rate overall. Sure, that leads to complications like the IRS, but let's not throw out the baby with the bath water here.
  • know1know1 Posts: 6,794
    RainDog wrote:
    In addition to what Pacomc79 said, there's also the structure of our society itself. It's markets, it's wares, the fact that it's reasonably open, makes it very benefitial to those who have money, and those who have the means to make money. What the rich recieve aren't so much the social programs themselves, but the stable society that social programs help keep a float - a society where the rich (and just about anybody - within reason, of course) can make and continue to make money.

    But what does that have to do with taxes? Are you saying the rich should pay more taxes because they get more benefit from private industry? That makes no sense.
    The only people we should try to get even with...
    ...are those who've helped us.

    Right 'round the corner could be bigger than ourselves.
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