For each generation that grows up in America, there is always one thing that they all share, taxes. Individuals pay taxes on almost everything these days. Taxes are charged on purchases of food, goods, and even services. Taxes are also taken out of payroll checks each pay period and deposited into government accounts for use later. And lastly, at the beginning of the year when income tax is due, if an individual has done what is necessary, they will end up with a refund. If not, they can end up with a high tax repayment bill that leaves them wondering what went wrong. What if, however, there was a way to change the Nation’s taxation system? Would it be worth it to an individual to pay more for items instead of paying taxes at the end of the …show more content…
Seniors and low-income families would suffer the most if a National Sales Tax were imposed. Seniors receive a majority of their fixed income from Social Security and supplement their income with savings. Since they have already “been taxed once on their earnings, they would essentially be taxed a second time on purchases.” (6) There are ideas though on ways to make exceptions for seniors so that they do not get taxed a second time. Lower-Income Families would also be affected because they receive benefits and credits, reducing personal taxes, however, they would possibly lose these if the National Sales Tax were adopted. A National Sales Tax would require them to pay more out of pocket towards food or services, reducing their monthly income. However, the National Sales Tax could reverse this problem by enticing individuals and families to consume less This will allow them to not only build savings but also lower the cost of goods and services because there will be less of a demand for them. The individuals of the United States will ultimately benefit from a decrease in the cost of goods and services regardless of their income status. In conclusion, there have been many arguments about the effects of a National Sales Tax. Those who oppose it say that it is too risky, causing harm the economy, significant job-loss and burden those that cannot afford necessities. Those who are for it argue that a National Sales Tax would do the exact opposite and plead for a change in the way America taxes its people. Therefore, in these uncertain times, especially for the future of the government, why not take a chance and try a National Sales
The FairTax Act will replace these costly, oppressively complex and economically inefficient taxes with a progressive national retail sales tax, which would be levied on the final sale ...
“No taxation without representation!” A fair tax system was what the American colonists were looking for and one that many say we are still trying to achieve. Today, while we are all represented in government and are all required to pay taxes, some still perceive the system of taxation as unfair, allowing for specialized interests, loopholes, as well as more/less taxation based on income. Should the American tax system remain the same, where individuals’ income is taxed based on how much one makes with loopholes and deductions? Should we consider a system that would eliminate progressive income taxes, taxing everyone at an equal rate through the Flat Rate Tax or should taxes be collected through national consumption of retail goods and the Fair Tax System?
I know that one of the benefit of our current income tax system is those who make a lower income will have to pay a lower tax percentage from their earnings. However, the disadvantages with this method is quite obvious. According to the Internal Revenue Service (IRS), the charts show that it has six federal income tax brackets between 10 to 35 percent, which means that our progressive tax system affects hard working people with a higher tax rate (Freedomworks.org). For example, people who earned an income up to $8,400 would be under the 10% tax bracket, while people earning about $360,000 or more would fall under the 35% tax bracket (Rosen, Elizabeth). The taxpayers are broken down into groups based on their taxable income. The more a person earns, then the more taxes they will have to pay once they reach the different taxes bracket levels
A. First and foremost it would shift the burden of taxes from the rich to the middle-class
What does every employee constantly complain about every single paid day? What is one of the main topics that the presidential candidates stressed while campaigning? How come people like drug dealers get a big advantage in this world when it comes to pay taxes? And again, what consistently holds down the hard working American? I have found a way to answer all those questions? This concept has actually found a way to tax everybody, not just the working ones. This concept also makes it fair and economical to our federal government, not just the individual taxpayer. Under the implementation of this concept an individual could receive a paycheck and have virtually no taxes taken from it. This 15% sales tax eliminates confusion, taxes everybody, and organizes the government in a way that has never been done.
In “The Federalist No. 21” Alexander Hamilton addresses the citizens of New York concerning the issue of taxation. Hamilton (1787) writes, “It is a single advantage of taxes on articles of consumption, that they contain in their own nature a security against excess. They prescribe their own limit; which cannot be exceeded without defeating the end proposed, that is, an extension of the revenue.” The advice given by Hamilton in 1787 is the backbone of the FairTax Act. The FairTax or bill H.R. 25 is not a flat tax or a VAT tax. It is a tax on consumption. The FairTax is a twenty-three percent sales tax levied on all new goods and services. The FairTax replaces all current federal taxes imposed on the people of the United States. This includes all personal and corporate income taxes. The twenty-three percent tax is not imposed on old or used items. It is applied only to new items. The FairTax is levied on all services, even on doctor’s visits. Educational institutions are the only exceptions to the rule. The FairTax is revenue neutral, meaning it provides the same amount of federal income as the current system. To prevent the FairTax from becoming an undue burden on the poor, a monthly prebate is paid to every family (Americans For Fair Taxation 1007). The prebate is equal to the amount of taxes a family pays on all purchases up to the poverty level. For instance, if a family was estimated to spend $26,400 a year on basic necessities, based on a 23% sales tax, their annual tax burden would be $6,072. This tax burden is paid to the family in monthly installments at the beginning of each month. With this prebate, all families living under the poverty level will pay no federal taxes (Boortz & Linder 2005). Arguably, the most app...
The United States tax system is in complete disarray. Republicans and Democrats agree that the current tax code is complex, unfair, and costly. The income tax system is so complex; the IRS publishes 480 tax forms and 280 forms to explain the 480 forms (Armey 1). The main reason the tax system is so complex is because of the special preferences such as deductions and tax credits. Complexity in the current tax system forces Americans to spend 5.4 billion hours complying with the tax code, which is more time than it takes to manufacture every car, truck and van produced in the United States (Armey 1). Time is not the only thing that is lost with the current tax system; Americans also lose great deal of money complying with the tax code. Resources that are currently wasted on record keeping, filing forms, learning the tax code, litigation, and tax avoidance. The cost of complying with the current tax code totals about $200 billion annually, or $700 for every man, woman, and child in America (Armey 1). The overwhelming consensus that the current tax system is inadequate has ignited the search for tax reform. There are numerous proposals for tax reform; one particular proposal brought forth by various conservatives is the idea of national flat rate income tax. The idea is to replace the current income tax with a single rate that everyone pays.
The current tax policy in the United States is very confusing and it is very costly for our government to administer it. It is in the best interest of our country and its citizens to revise or replace our current tax policy.
For years, the United States government has been trying to find a way to lower the obesity in the country. However, the approach it is using, i.e. taxing unhealthy food, is not the most effective one. People are going to purchase whatever products they wish, whether the price is increased a few cents or not. Junk food options are already set at a more reasonable price than healthy foods, enticing people to buy these less expensive goods. Even though putting a tax on other products, such as tobacco, has served the intended purpose, food is a necessity humans must have for survival. Society is used to consuming foods they want, and will continue to do so. Putting a tax on unhealthy food will not necessarily lower the obesity rate because there are other factors that contribute to this problem. Moreover, taxing measures are usually intended for the collective benefit of society rather than the individual. They are usually perceived as another way the government uses to take money out of the citizens’ pockets. Ultimately, thinking that higher taxes on unhealthy foods will help curb down the obesity rate in the country would be similar to say that cost is the sole contributing factor to this public health problem. Imposing taxes will not help lower the consumption level because these foods will still have lower prices than healthier choices. Taxes do not impact the nutritional value of foods, and their only predictable effect is to help in generating additional revenue for the government.
The flat tax will make taxes fair for all people. No matter what race a person is, what social class a person is in, or who they’re friends with, they will end up paying the same rate. Every single taxpayer will have to sacrifice just as much of his or her life as the next person down the road. One of the three main reasons for taxes is to maintain fairness. This is most reasonable ways to maintain fairness. The wealthy will still be paying more money than the poor person, but they both have the same tax burden.
The government use of taxes plays a crucial role in today’s economy as well as personal finances, it has and will continue to leave its mark on the world we live in.
The four types of taxes this paper will discuss are income tax, sales tax, property tax, and user fees. Income tax was not permanently established until the 16th Amendment was passed in 1913. Most federal taxes had been previously derived from excise taxes on tobacco and alcohol and other consumer goods. The US Constitution, when written and still continues to, legitimize taxation in the United States through Article I, Section 8, that Congress has the power to lay and collect taxes, duties et al, pay the debts or provide for the common defense and general welfare of the United States (Cornell Law LII). Investopedia defines income tax as ‘a tax government(s) impose on financial income generated by all entities within their jurisdictions (Investopedia, 2014). Businesses and individuals are required to file an income tax return every year to determine if they owe taxes or qualify for a refund. That is determined by measuring the total income one earns to a designated tax rate, calculating one’s taxable income, which are some or all items of income reduced by other adjustments or expenses in that tax year. There are different subcategories of income tax; there is a federal income tax that is set by the federal government, apart from a few states, there is a state income tax that is imposed on their respective residents, as well as the possibility of there being local income tax ...
Warner, KE, Chaloupka, FJ, Cook, PJ, Manning, WG, Newhouse, JP, Novotny, TE, Schelling, TC & Townsend, J “Criteria for Determining an Optimal Cigarette Tax: The Economist’s Perspective” Tobacco Control. 380-386, 1995. Print.
The use of taxes is one of the government's favorite ways to make its presence known in the economy. While this method seems blatantly obvious, many of the ways the government uses the money collected by taxation is not. Some of the money it takes is used to fund other programs designed to "protect" consumers and to "create" jobs. Be...
However if only indirect taxes are implemented, the revenue could be useful to fund not only negative advertising, the consumers who wish to relieve the taxation burden could change to other uses to carry their groceries such as a shopping bag that can be used over many times.