[teal]

Originally posted by Narrew:

Income Tax--the top 50% of Income tax payers pay 96% of Income tax's, that is from IRS figures. I think a flat tax would be more reasonable (a very low one) then have a national sales tax, so if your rich and buy rich things, you pay! I would make congress put a super-majority requirement on that (both the flat tax and sales tax).

First off, its very well known that sales tax is actually a *regressive* tax. This means that practically speaking, instituting a sales tax or instituting an income tax where the poorest 20% pay an income tax rate of 30% with the next richest paying an income tax rate of 25%, etc. are functionally identical.

So my question for you is. Do you think it is fair to have a tax system where the richest people pay proportiantely *less* of their income than poorer people? Your initial rhetoric is talking about a flat tax, so I would think that you think it is fair to have people pay an even percentage of their income to taxes. I agree with this as far as it goes, except in that I have seen some fairly compelling arguments that a progressive tax system is actually a good thing for the economy as a whole and thus I might favor that if these arguments hold water. But that is besides the point. The point is that a national sales tax is highly *regressive* in nature. In effect, what you are arguing here, is that poorer people should pay more of their income to taxes than rich people.

It get's worse though. Federal taxes are of course not the only taxes that Americans pay. They also pay local and state taxes as well. Sadly many states already have a regressive tax system because they rely heavily on sales, excise, and property taxes, all of which are regressive.

http://www.ctj.org/itep/whopays.htm

What this means is that even if we instituted just a federal flat income tax that the poorest peole would be, on average, paying more of their income in total taxes than richer people throughout the 50 states because of the effect of these regressive state and local taxes. We need a progressive federal income tax system just in order to make the overall tax system flat!

Narrew may be particuarly interested to know that Washington state is one of the worst states in the nation in terms of being particuarly regressive:
Total local and state tax rate as a percentage of income in Washington state:

poorest 20%: 17.5% of income
20% to 40%: 13% of income
40% to 60%: 11.5% of income
60% to 80%: 9.5% of income
80% to 95%: 8% of income
95% to 99%: 5.5% of income
richest 1%: 3% of income

I can't think of any possible reason why this is a "fair" state of affairs.

Next time you listen to a politician spouting about a "flat" tax ask them about how they feel about sales and excise and property taxes as well. If you truly believe in equal tax rates then you can't in good conscience advocate these kinds of taxes.

[ September 18, 2003, 03:46: Message edited by: teal ]