DSK wrote:
Like a flat tax?

Simple, yes. Fair?

Walt wrote:

With the right exemptions, it can be. Say, a flat X percent with the
first Y dollars exempt.


Then it's no longer a flat tax. It's a step-function progressive tax.

If you insist on being a purist, perhaps.

I was referring to the work of Hall & Rabushka in the early 80's, the
grandfather of all modern "flat tax" proposals. It had a flat 19% tax
that applied to corporations and individuals with at $25k deduction for
individuals.

As it's proponents say: "One of the many benefits associated with a flat
tax is that it is able to achieve progressivity in the tax system--those
earning more pay more in taxes as a percentage of income--while at the
same time eliminating the damaging effects of high and increasing
marginal tax rates."

See http://www.taxpolicycenter.org/publi...cfm?PubID=8521.
or
http://www.fraserinstitute.ca/shared...sNav=pb&id=151

IMHO it would be far more fair, and waste a heck of a lot less
productive effort, to have income taxes either eliminated altogether
(not likely, the Feds depend on it far too much) or made into a very
simple equation with few exceptions, exclusions, loopholes, etc etc.

The problem as I see it is that every time the rules of the game get
changed there's a lot of noise and smoke about how it's going to become
fairer, but in the end those who can afford to buy the politicians come
out ahead. Strange, eh?

That way, an argument about whether the tax was unfair to rich people
could focus on where it should be, the marginal rate of increase of the
tax at some given income level.

But that's not likely, since too many people want to start the argument
by thrusting their own silly assumptions ("taxes should cater to the
self-intterst of the wealthiest 5%") forward as axioms.

Many people seem to go along with the "taxes should cater to the
self-intterst of the wealthiest 5%" axiom because they have the idea
that they'll be one of them someday. Commonly, this is referred to as
being a "sucker".

//Walt