FLAT TAX RATE

YABAYABA Posts: 1subscriber
edited January 2009 in New Member Welcome
To help jump start our economy could a new flat rate tax system across the board for the rich and not so rich be a solution to our economic problems?. Maybe on the order of 2.5 percent. Please give your opinion.

Comments

  • SlowCookerMateSlowCookerMate Posts: 1subscriber
    I`m not real sure what you are asking.
     
    Are you saying everyone should pay the same rate or are you saying we should eliminate tax deductions?  Two very different things.
     
    A flat rate where everyone pays the same rate creates a system where the poor shoulder a disproportionate amount of the tax. 
     
    A system that eliminates tax deductions eliminates the govt`s ability to encourage certain activities like saving for retirement (401K/IRA/Simple) or some of the energy conservation credits.  Not to mention the special interest groups in Washington would never allow their credit/tax deduction to be eliminated.
  • YABAYABA Posts: 1subscriber
    Hello, friend and thank you for your reply and thanks to the others who also gave their response. If you remember I did not mention the poor specifically becouse under this flat rate tax they are not going to pay until all their basic needs are met. This idea of tax relief will take into account the expenses each person or household will need to survive on. With today`s average standard of living $25,000.00 is a good start. In other words, the burden should not be more than a person can handle.
    YABA11/10/2008 6:48 PM
  • nevadasculnevadascul Posts: 3subscriber Member
    A flat tax rate bill has been introduced numerous times in the U.S. Congress.  The rate was 10%.  There would be no IRS and the program would save millions of dollars a year in operational cost currently spent to collect income taxes.  It was also estimated that more money would be collected under this system than the current system. 
    However, there would be NO EXEMPTIONS for anybody or any organizations.  Not surprising, the bill has never made it out of committee to the floor of ether house for a vote.
  • qsoundrichqsoundrich Posts: 0subscriber
    There`s some very practical reasons why we don`t have a flat tax in this country.  The biggest one is that it removes a lot of incentives to own your own business (if you`re talking about no deductions.)  Same goes for the "Fair" tax, which would have the effect of discouraging the exchange of money and would in turn slow down the economy.  Both of these systems would place a much higher amount of overall tax burden on the middle class, and they would hurt economic growth.  Getting rid of the IRS won`t mean we don`t have to pay taxes.  At least we`re way ahead of the game as business owners already. 
  • TaxLadyEATaxLadyEA Posts: 0subscriber
    kywomanjt... sad to read that you worked for the IRS.. not to sure what you did.
    Your statement  "If you have $2 of taxable income, you have to pay $1 in federal taxes." is so false it is ...   Sounds more like you are receiving Social Security (due to your early retirement) and found out that if you work above a certain dollar amount.. you have to pay back $1 for every $2 earned over $13,560 in 2008 to Social Security !!
     
    I have a much better idea than the Flat Tax...  How about taxing Social Security !!
    Once the receipient receives all the money that was paid into the system plus a % interest based on their cumulative contributions by quarter......
           Let`s see after 4-5 years of receiving Social Security... than all that money.. which everyone
           else is putting into the system.. and you are taking out of the system...  gets taxed !!
     
    CORRECTION:  A single person who has wages of $25,000 for 2008 has an `ordinary tax` of  $1,605 which works out to 8.04% ..
     
    AND..
    No one.. neither the poor nor the rich.. is allowed or does the following.. unless they are unscrupulus.. because it is illegal !!  and the rich are not that stupied !!
    "  The poor can`t deduct their gas expenses driving back and forth to work or their car
        insurance, they can`t deduct a clothing allowance for clothes they need to wear to work
        when employer dictates "business like attire", or their work shoes, or their vehicle to get
        them to work, or their lunch money.  But, by golly, the wealthy sure does this.  They call
        them "business expenses", so why can`t the low income people be allowed to claim "just
        trying to survive" expenses."
     
    As to attrition within the IRS.. technology reduces the amount of manpower needed for certain jobs... that has been going on for over 25 years across the board in all large businesses.
    SIDE NOTE:  the IRS is looking to hire at least 600 people just to do audits to close that $290 billion dollar tax gap...
     
    By the way...  our greatest problem remains...   mismanagement !! 
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