A Progressive Flat Tax by Justeconomics
All income you receive will be taxed at a single rate (~25%?) subject to the following two adjustments only:
1. Deduct $10,000 from your household's income for every living breathing human being
2. Deduct/Add your net deposits/withdrawals to/from any saving or investment account.
Repeal:
Corporate taxes
Capital gains taxes
Payroll taxes
Property taxes
Estate taxes
Sales taxes (except when applied to control externalities such as cigarette taxes or gas taxes)
If you support a family of 4 with a $40k income, you will pay no taxes. If you have an income of lots and lots of money, you will pay about 25% in taxes.
If you want to raise more revenue, increase the tax rate (on everyone). If you want to make the tax more progressive, increase the personal deduction.
Dead rats and dopamine - a new publication
9 months ago
There are a few problems with this , in theory it its a great idea however difficult to implement without attracting politics.
ReplyDeleteFirst, the 40k income doesn't make much sense, for instance obama had proposed exempting seniors making under 50k from income tax, however many seniors have many assets and are just living off retirement income.
40k may not be enough money, there is a difference between 40k in New York City, Boston, Washington DC vs. Knoxville, Tennesee or Sioux Falls ,South Dakota.
The cost of living influences income because you need income to cover expenses. Also, the idea that we should subsidize more children may not be well supported by politicans. Although a tax credit already exists for dependents, it is already critized , mainly from progessives who claim that conservatives often wrongly hype or chide and promote the stereotype that African Americans and Hipanics are poor because they are on welfare and havea lot of kids.
Nothing could be further from the truth, tanf really is no money, most people on welfare are white which was never brought up atleast during the 1996 welfare reform debate , and the average family wasn't six or eight children. Furthermore, US welfare benefits and much lower than other industrial countries such as sweden, france, switzerland,etc.
Now, the middle class dependents can be deducted from a tax return. Thus, it leads to a slippery slope, do we start deducting home interest which is widely critized because more children need more home space, then college tuition and the other sorts of deduction.
Also , the OP fails to mention state policy, we live in the United States of America and states have different policies than the feds, of course you could make the argument that they should copy and just have an income tax. Property taxes are not leveled by the federal governement, its a state policy but it varies, whether in a big city, or locally as in new jersey.
A similar system exists, the Alternative minimum tax eliminates deduction ability and gives a flat tax of 28%, however it affects upper-middle income taxpayers who have children and live in states that levy higher state/local taxes and those who have medical bills.
Also, again there is a difference between wealth and income, in short this idea has great points, but will not work.