progressive tax fairness

The arguments regarding federal progressive income tax has been represented to us through the United States Supreme Court, on the floors of congress, and in media. The revenue from taxes reached the objective of financing wars from the Civil War through World War II. At the same time deteriorating the economy with fewer dollars that could be used on imports, exports, and services (Henchman). Today, the United States deficit is $18,800,241,350,538.12 this is a grand total of 58,405.32 owed by every man, woman, and child (Brown). The legal illusion is presenting the question, is income tax legal? There are Americans today who believe income tax is not legal and stand by their beliefs in a movement that has cost many individuals considerably. I am interviewing such a person, his name is Bobby Ray and the history he presented to me was interesting, and has left me with more questions than answers.

Throughout the entire existence of any form of government, there has always been taxes. Most of the time (if not all), people hate taxes. With this being said, the United States has adopted a progressive tax since its very existence. We believe that if our nation is placed under a flat tax system, our economy will operate more effectively. If we incorporate a flat tax system we will be able to ensure fairness among all citizens, eliminate tax loopholes, and allow opportunities for business expansion. With this being said, we will be examining the strengths and weaknesses about the flat tax system and how it has been used into practice.

In the United States, the top one percent received about 20 percent of the overall income for 2016. This creates an uneven distribution of income causing Americans to argue about whether or not the wealthy should pay more in federal income taxes. One side of the argument is that the wealthy make a huge portion of the nation’s income; therefore, they should have higher tax rates. The other side argues that wealthy Americans already pay their fair share of taxes by paying nearly 40 percent and should not be forced to pay more. These arguments both use compelling evidence to make their claims; however, a solution could be reached by increasing the tax rate of the top one percent by only 10 to 20 percent.

The top 1 percent of the wealthiest people in the U.S. pay a total of over 40 percent of all federal income taxes, which is more than the entire bottom 95 percent of all tax payers. Government programs are funded through Social Insurance Taxes that are the fastest growing source of federal income though it’s actually counted separately in special trust funds by the Treasury. Both federal and state governments combine these taxes that are used to pay for social programs such as social security, Medicare, and unemployment services. This type of taxation is a regressive tax, since lower income people end up paying more from their income than those with a higher income. Another federal tax is the excise tax, better considered a luxury tax for non-necessities, which include things like liquor, cigarettes, gas, and highways. Taxes that are imposed on imported goods so that there’s less foreign competition on the domestic market are called customs duties.

The federal government puts tax on everything, this allows them to take a percentage of our money away from us and use it for the country. Right now the US in debt and can’t afford to run this country alone. They use our money for several things everyday. However, there are limits to what the can tax such as; they can not tax Church services because it goes against our first ammendment right.

The tax policy in the United States is very confusing. When the tax policy was originally written in 1913 it was four hundred pages. Now, over the past ninety one years, that tax policy has evolved to over 72,000 pages. Since the tax code has become so lengthy and nearly impossible to understand, the topic of tax reform has been in the minds of many. Although, most barely think about tax reform until tax season. It is a controversial subject due to the impact a change in tax code would have on the American people. The two most popular and widely known stakeholders in this debate are the two major political parties in the United States, the Democrats and the Republicans. The two parties share absolutely no common ground on the subject of

In 1861, Lincoln levied the first federal income tax by signing the Revenue Act. Needing cash with which to fund the Civil War, Abraham Lincoln and the Congress agreed to impose a 3 percent tax on annual incomes over $800.00. The wording of the Revenue Act was broadly written to define income as a monetary gain derived from any kind of property, or from any specialized trade, employment, or vocation carried on in the United States or elsewhere or from any source whatever. (A&E Television Networks, 2014)

There are three different types of tax systems presented in this article: Progressive income tax, Flat tax, and the Fair Tax. The progressive tax system is what we have in the US and is common in countries across the world. It bases the percentage of income tax you should pay by the amount of income you receive. Basically, if you have a large income then the rate of tax you will pay is larger and, furthermore, if you have a low income you will have a lower rate to pay. Many conservatives dislike this system because it forces the top percentage of taxpayers to pay a majority of the tax revenue. “According to the Tax Foundation, the top 1% of taxpayers have consistently paid more in federal income taxes than the bottom 90% since 2003…” It treats people differently and it allows for

Before delving into the topic at hand, a look at the current and projected tax system will help understand the predicament of taxing the upper class. According to Bardes, Schmidt, and Shelley, in the textbook American Government and Politics Today: Brief Edition, Americans pay a variety of federal, state, and local taxes, which are all assessed on most sources of income, sales and land. Bardes et al, made their agenda clear by pointing out that “the wealthy receive a much greater share of their income from these sources (capital gains, rents, royalties, interests, dividends, or profits from business), than others do (315).” But what is considered wealthy? In the article, Who gets to be “Rich”, Jordan Weissmann reported that a household income of around $113,000 lands one at the top 10% of income earners, while $394,000 makes one a

Our current income tax system today is very complex, unfair, inhibits saving, investment and job creation, imposes a heavy burden on families, and weakens the integrity of the democratic process. It can't be fixed and must be replaced. The U.S. income tax code is a long and complex system. The income tax system is so complex; the IRS publishes 480 tax forms and 280 forms to explain the 480 forms. The IRS sends out eight billion pages of forms and instructions each year. The administrative costs of the tax system far exceed those borne directly by the IRS. Each year Americans devote 5.4 billion hours complying with the tax code, which is more time than it takes to build every car, truck, and van produced in the U.S.

There is an issue that has plagued the United States even prior to the founding of the nation. That issue is fair taxation. While the American Colonists were being taxed unfairly without parliamentary representation, average modern Americans are being taxed unfairly without legal representation. Some hold the belief that the progressive tax code employed by the United States to be fair as the wealthy pay a higher marginal tax rate. The operative word there being marginal. As the upper class typically has a much lower effective tax rate since they are able to afford tax attorneys who are able to find many deductions that average citizens are unaware of. Mitt Romney is a prime example of low effective rates of taxation. According to CNN Money, Mitt Romney made twenty-one million dollars in one year, but only paid an effective rate of fifteen percent, which is much lower than the rate he should be paying. The progressive tax system is one that is littered with loopholes, but those are only known to those with the means to search them out as the federal tax code spans seventy-thousand of pages of convoluted text. Not even the highest paid tax accountants will ever read anywhere near the full volume of tax laws. By the tax code being as long as it is, few are able to reap the full benefits of the tax code. The level of complicated text is not the only major issue with the federal tax code.

They created a system with numerous taxes and fees that affect every part of human life, so even when somebody buys a little sandwich, some amount of money also goes to the budget. This system of taxes and fees was created with the early establishment of the country and develops from year to year. Sometimes when the government needs more money to spend, they just create an additional tax that will raise enough money. According to the National Priorities Project (NPP), the federal government raises trillions of dollars in tax revenue each year, and for example, during the 2015 fiscal year, the government earned $3.18 trillion. So, the main sources of American budget are taxes and other fees, but they also differ from each other. According to the National Priorities Project (NPP), the three main types of taxes are, income taxes paid by individuals, payroll taxes paid jointly by workers and employers, and corporate income taxes paid by businesses. Between these three types of taxes, the income taxes play the biggest role (near 50%), so it is clear that national budget is formed by ordinary citizens who pay their taxes. Some of the citizens are not satisfied with such distribution and believes, that corporations and business owners should play the biggest role in taxation, while ordinary citizens should pay lower taxes. Despite this controversy, the modern taxation system was formed many years ago, and nowadays it performs well, so there is no direct reason to change

Throughout history, taxation on United States citizens has proven to be a necessary component of a growing economy as means of generating revenue for the federal budget. The federal budget funds the many government programs implemented to keep the disabled, elderly, and unemployed from falling bellow the poverty level. Unfortunately, this fund is not always available when catastrophic evens, such as an economic recession, deplete the revenue coming in and create a budget deficit. In order to regenerate money coming in and replace the deficit, the government calls on money gained from taxes. What happens when tax money is already appropriated to other programs? A tax reform. A tax increase has many times been the

We have all heard the famous quote by Benjamin Franklin who stated, “In this world nothing can be said to be certain, except death and taxes.” (“Benjamin Franklin Quotes”) We find this to be true as we begin working and feel the pain of money being taken from our paychecks. Then we face the chore of having to file income taxes yearly. Although there are many taxes we are subject to, most people are referring to federal income tax when they complain about taxes. There has been debate for decades about the current system but there has been no agreement on how to fix it. The United States currently has a progressive tax code which means people pay taxes according to their earnings. This has been in place since the time of Abraham Lincoln. An alternative

The Federal Government relies predominately on the individual income tax, and federal income tax makes up more than 50 percent of the federal government’s revenue. Income taxes are paid by all those who earn income (Mikesell, 2011). It is essentially a bill from the federal and state governments for individual earnings through salaries and investment profits. Income tax is considered a progressive tax because the individual's financial obligation rises with the level of reportable income (Mikesell, 2011). Although income tax is the one of the most effective ways of raising revenue for the government, it is also one of the most controversial.