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Could a Flat Tax Work?
Recent reports have been released about the increasing percentage of Americans who do not pay taxes every year. Over the past thirty years, the percentage of tax paying citizens has continued to decrease. Within the past few years, that number has gone to around 50%. Yes, that means only 50% of Americans are paying taxes, while the other 50% do not. This may seem like a shocking number, but sadly, it’s true.
It’s staggering to think that only half of the nation pays taxes. Another statistic that is hard to believe is that the top 3% of tax payers makes up about an equal share as the bottom 97% of tax payers. The top 1% is responsible for around 35% of all taxes collected.
With numbers like this, it seems as though there are some problems to resolve. Obviously, the top 1% will always pay more because they earn more. Unfortunately, the 1% still continues to get hounded for more. The occupy movement has been going after the top 1% wanting more of their money, and legislation has even been proposed that could increase their tax rates.
This is the opposite of what needs to happen. The top tier is already bearing the blunt of the load. They do not need to be further burdened. It is not fair for them to have to essentially be punished for making more money. The economic system in the United States is supposed to function in a way that people can become as wealthy as they want. This is money they have earned through hard work. There is no reason they should have to share the wealth.
Many would agree that they system of taxation needs to be overhauled. Whether it is because of how complex it is to file or because 50% of citizens don’t pay federal taxes, issues with the system are easy to find. But what can be done? Solutions have been posed in the past and brought up in legislation, but no changes have been made.
One possible solution that has been brought up over and over is a flat tax. The flat tax would eliminate tax brackets and all of the specific details when filing taxes. With a flat tax, everyone’s tax rate would be the same, whether they made $10 or $10,000,000 for the year. For instance, say the flat tax was set at 10%. That means anyone, no matter what their income was, would pay 10% of it. This tax is fair across the board.
This would require anyone earning an income to pay taxes. It would help to eliminate the high number of people not paying anything. It would balance things out so that the top percentage of earners did not pay such a high percentage in taxes. It would also help move the country away rom the socialist trend it has been on. The rich would no longer be forced to support so many people living off entitlement programs because they would not have to share such a large percentage of their money. It is not for sure if this system could actually work, but as things stand now, the tax system needs fixed.