Ranting to /dev/null

The income tax started out as a single rate (flat) tax. Under the control of government and isolated from the People, it gradually grew into an oversized, complex mess, with numerous loopholes, multiple brackets and high rates. In 1986, the tax code was overhauled, simplified and reduced down to two brackets. Many deductions and loopholes were eliminated. Today, we are up to six brackets, and most of the loopholes are back.

This demonstrates that a flat tax simply won't stay flat due to the precedents that have been set. A flat income tax leaves the current tax code in place and sets the stage for another return to the system as it is now; Congress has the power of tax legislation, and citizens have little input or control. Lobbyists have better access to congressmen than we do, and use their influence to procure tax breaks for special interests. Each tax break complicates the tax code just a little more, and they all add up to a code with over 66,000 pages that tax professionals and even the IRS don’t fully understand.

The solution is to stop using income as a tax base, and use consumption instead. There is only one consumption-based tax replacement proposal that will address the problems generated by our tax code: the FairTax Act of 2007.

A shift to a consumption tax base and total replacement of the tax code should be the foundation for tax reform, including Social Security and Medicare.

Yeah, I suppose I should have expected something like that. This isn't even an original comment, it's a cross-post cut-and-paste. Way to push your agenda.

You totally missed the point of the article, which is that the tax structure is pretty much already flat. The vast majority of Americans pay approximately 40% of their annual income in taxes. But unless I'm severely mistaken, you're not really interested in talking about this. You've just set up a GoogleAlert to notify you every time someone posts something with "flat tax" in it, and then you repost this exact comment. Though I do have to thank you for leaving out a big chunk of your usual bit.

The vast majority of Americans pay approximately 40% of their annual income in taxes.

For the sake of argument, let's look at the top 10% of wealthiest Americans. What you say about the "vast majority" may very well be true, but that wealthiest 10% segment income represents more than that of the other 90%. Many of the tax loopholes that exist benefit this minority the most.

45% of a $45,000 a year income is a lot of money to the average American. A 3% swing in either direction is a noticeable difference for a family averaging this income yearly. Perhaps enough difference so as to affect whether the family can afford to save for their child's college education?

45% of $45 Million a year is a substantially greater sum of money. A 3% swing is still a noticeable difference, but it CERTAINLY isn't the difference between little Johnny or little Janey going to college.

More likely, it's the difference between Johnny or Janey getting their own private island upon graduating from Harvard Law.

It may not pertain to "income tax" strictly, but the recent talk about the Estate Tax is a perfect illustration of the sums of money we're talking...

If the Estate Tax were to be repealed completely, the estimated savings to just one family -- the Walton family, the heirs to the Wal-Mart fortune -- would be about $32.7 billion dollars over the next ten years.

The proposed reductions to Medicaid over the same time frame? $28 billion.

Source:
http://www.alternet.org/columnists/story/48278/

Please ignore the liberal slant of the article and look at the numbers themselves. Even if that's an exaggeration, we're still talking about sums in the Billions of dollars.

The truth of the matter is that with a flat tax, these people wouldn't be making these mind-numbing incomes, as they wouldn't have the exemptions in place to allow their money to make more money for them. It'll never be allowed to happen.

I'm not sure what my point is anymore, so I'll just attempt to bow out gracefully and say that the field is by no means "flat" for ALL Americans.

Slovakia has had a 19% flat tax for a coule of years. Eat that Free market America... :)

In all humerous abundance aside, I am not sure as to what the "exemptions" are... Besides the Walton family would more than likely funnel the USD32.7 B. back into investing in the US or abroad. Get some America. Perhaps it would not go directly to Medicaid, but heck, if you ask them nicely they might set up a fund for the poorest in xyz states, perhaps by asking them for something they will give it. Who knows.

During the Reagan administration, a committee appointed to study the federal income tax found that 100% of the federal income tax is used to pay off interest on the federal debt. I doubt that number is much different today (though it'd be impossible to know for sure considering that the federal government currently has over 3 trillion unverifiable accounting transactions).

The income tax isn't really used for revenue; its primary purpose is to redistribute wealth. For the most part, the federal government raises revenue through inflation caused by manipulation of the money supply. It doesn't really matter what the tax rate is, or who pays how much, because a government that can print money is a government that can spend whatever amount it wants (at least until inflation pushes the market rate of the currency to zero).