Replacing the Income Tax With the Flat Tax Essay

Replacing the Income Tax With the Flat Tax Essay

Length: 2323 words (6.6 double-spaced pages)

Rating: Term Papers

Open Document

Essay Preview

Did you know that an astonishing 43.4 percent of the people in America do not pay any income taxes" (McCullagh 1)? This is roughly 65.6 million people that aren't paying taxes and this is putting our economy and country at its breaking point. Our current tax system penalizes those that work and save money. People that pay no taxes still get to enjoy the benefits. The United States needs to look at which tax is fairer to the people and easier to administer by the government. Although some may disagree, the Flat Tax should replace the income tax to simplify and bring fairness to the system, increase income, and create jobs.
Currently, the United States has a federal income tax that is very difficult to understand, to comply with, and to regulate. The current federal income tax is an inclusive tax. This means that citizens are taxed a certain percentage of the total money they earn. Citizens are also taxed on monies made from investments and monies they inherit. Under our current federal income tax system, people pay taxes based on their total income. This helps those that don't work or make less. Currently low income families pay little or no taxes. Those people against a flat tax say that these people with lower incomes will be the ones most affected by a flat tax system. However, under the Flat Tax system, "the threshold at which people start to pay the flat tax is set high enough to exclude low earners altogether" (Nguyen 1). Also, there are allowable deductions under our current income tax system that will not exist if the United States changes to a flat tax system. "Tax payers struggle to comply with tax laws so complicated that even the IRS cannot figure them out. IRS commissioner Douglas Schulman recently ...

... middle of paper ... "Tax Day 2011 - We Need a Flat Tax More Than Ever," Fox News. 18 April 2011. 20 April 2011.
Moore, Stephen. "Replacing the Federal Income Tax," Cato Institute. 8 June 1995. 14 March 2011 .

McCullagh, Declan. "The Income Tax System is Broken," 15 April 2009. 3 March 2011.

Nguyen, Samuel. "The Practicalities of Flat Tax," Adam Smith Institute. 2005. 11 April 2011.

Tomlinson, Shelly-Ann R. "A Consumption Tax versus a Federal Income Tax in the United States," University of Georgia School of Law. 2007. 24 March 2011. .

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

The Current U.s. Tax Program Essay

- The current U.S. tax program distinguishes rates by an individual 's income. This tax program is also known as the progressive tax program. The counterpart to this program is known as the flat tax program where everyone pays the same rate on income, regardless of one 's wage. This needs to change in order for everyone can be on the same income level. The Government should replace the current progressive tax on income with a simple flat tax in order to create economic fairness and to prevent tax evasion....   [tags: Tax, Progressive tax, Income tax, Taxation]

Term Papers
1027 words (2.9 pages)

flat tax bill Essay

- 106th Congress IN THE HOUSE OF REPRESENTATIVES ___________________________Introduced the following bill in which was referred to the Committee on _______________ A BILL To tax income once and only once at a single rate. 1. Be it enacted by the Senate and the House of Representatives of the 2. United States of America in Congress assembled. 3. SECTION 1. THE TITLE 4. This Act may be cited as the “ Flat Tax Bill.” 5. SECTION 2. THE BILL 6. The flat tax replaces the current income tax code, which is very 7....   [tags: essays research papers]

Term Papers
600 words (1.7 pages)

The United States Should Not Impose a Flat Tax Essay

- A flat tax is a system in which a person’s income is not a factor and a single rate is set for all taxpayers. This kind of tax includes no deductions or exemptions. The United State’s current, progressive tax is very different from a flat tax, the most noticeable reason being that a progressive tax takes different percents of income depending on what income bracket a person falls into (Investopedia). During 2010 in the United States, “individuals who earned up to $8,375 fell into the 10% tax bracket, while individuals earning $373,650 or more fell into the 35% tax bracket” (Investopedia)....   [tags: current government revenue system]

Term Papers
935 words (2.7 pages)

The Basic Administrative Goals Of Tax Policy Essay

- The basic administrative goals of tax policy are uncontroversial: taxes should be easy to understand and enforced in a fair manner. (Gale, 2000) Changes to the U.S. federal tax code since the Tax Reform Act of 1986 have led to a system that is too broken to fix. Politicians from across the political spectrum have been actively proposing overhauls to the dysfunctional tax system. Since 2003, there have been eleven different tax reform proposals all to fix the tax code with means of replacing the current system....   [tags: Tax, Taxation in the United States, FairTax]

Term Papers
1274 words (3.6 pages)

Questions of Tax Reformation Essay

- Whether or not to keep or discard the Bush era tax cuts for the wealthy, give tax breaks to the lowest tax bracket, and even throwing out the entire current tax code and replacing it with a simpler version, tax code and tax law has been a very controversial topic for the past few years. As it stands, the current tax code has over seventy two thousand pages, compared to the four hundred pages it had in 1913. There are many different stakeholders in this debate including taxpayers, corporations, businesses, etc....   [tags: organizations, stakeholder, government]

Term Papers
759 words (2.2 pages)

The Variable Rate Income Tax: Flat Tax Essay

- Filing income taxes is something all working Americans do, rich or poor; however, the amount paid isn’t what most would expect. Besides the obvious ways of reducing taxable income, such as decreasing the amount of withholdings, reducing increasing deductions, and taking advantage of tax credits, those who are determined to save, generally the upper class, find other ways (Perez). These ways may include investing, putting money into savings, or switching account types. This is what allows the rich to keep getting richer and prevents the poor from getting significantly better....   [tags: taxes, taxable income, tax credits]

Term Papers
1693 words (4.8 pages)

Progressive Income Tax Regulations Analysis Essay

- 1) Progressive income tax regulations pose ethical choice situations to individuals, corporations, and the government. When Congress (as a decision maker) vote down a bill to replace progressive tax rates with "flat taxes”, its action is justified on utilitarian grounds. With individuals and corporations as the decision maker, voting in favor of progressive tax is an ethical choice situation, as the law requires those who earn more to pay more, and vice versa. Citizens with higher income pay proportionally higher taxes for society to benefit....   [tags: flat taxes, income tax, taxation]

Term Papers
824 words (2.4 pages)

Implementing A Flat Tax System Essay

- I. You might have heard politicians in the news, talk about overhauling our tax system with a new fix-all idea, the flat-tax. This would simplify our overly complicated tax system and might seem appealing at first glance, however there are serious problems with it. II. Implementing a flat tax without significantly increasing the deficit is impossible without shifting the burden from the rich to the middle-class, instead our current progressive tax policy needs to be changed so that it is simpler and does not allow corporations to abuse the tax loopholes....   [tags: Tax, Taxation, Progressive tax, Income tax]

Term Papers
1141 words (3.3 pages)

Flat Tax System Essay

- The current tax system is extremely complicated and punishes those who are successful by taxing people more than the average citizens. If flat tax were to be in the United States it would create fairness within the economy and be less complicated. Flat tax would not punish people for having higher income; instead flat tax would create equality to all tax payers. The taxpayers would not be complaining to the neighbors or their close relatives about their tax rates and how different they are from each other....   [tags: marginal tax, income tax]

Term Papers
1738 words (5 pages)

The Flat Tax Essay

- The national debt is growing and the government is unable to keep up under the current Progressive tax system, in the United States. A solution for the United States debt is to switch to a flat tax system. A switch to a flat tax system would simplify the tax process, it would make taxes fair and even, and it would allow the government to reduce the United States national debt. A flat tax system is a system that taxes every individual at the same percentage. It is not like any system the United States has seen before....   [tags: Tax Policy]

Term Papers
1969 words (5.6 pages)