I know its been this way since 1913 with the adoption of the federal tax system, but....
How is it that the government has the legal authority to impose higher taxes on certain classes of individuals as compared to others. Doesn't such a policy discriminate against a segment of the population and thus might be unconstitutional. If you make over a certain amount, your tax percentages are higher.
And to take it to yet another extreme, the number of registered voters making less than 250k is substantially greater than those who make more than 250k. Thus we have a majority voting in politicians who then raise taxes on the minority. Seems like taxation without representation, lack of equal justice, isn't it?
Going back to our founding fathers, progressive taxation has been a fairly conservative notion.
Thomas Jefferson said in a 1785 letter to James Madison, "Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise."
Giving the wealthy a tax cut during a time of war and deficit, as happened under the Bush administration, surely leads to economic disaster - we are living in such a time.
Take a sales tax, which is flat. Everyone is taxed at the same percentage. But someone who is poorer is taxed at a higher percentage of his income than someone who is wealthy.
Taxing different income levels isn't discrimination per se, because anyone who makes 336,000 a year can quite easily make 250,000 instead and pay a lower tax rate. You're not going to be stuck in that 336,000 rate like say someone would be stuck with given race, or gender. So it's not really the same.
I like a progressive income tax because it puts the hardest tax burden on the people with the most DISPOSIBLE income. It lessens the pain and misery of taxation.
Another positive aspect of a progressive tax system is that it created stronger small and medium sized businesses. With taxes high on large incomes, many business owners instead of collecting an income would put the money back into their own businesses and re-invest and pay a lower tax rate as a result.
I hardly think that people making over 250k are not well represented in Congress. Part of the benefit of having a lot of money, is that your wealth translates into power. Such a person can hire a lobbyist, something the vast majority of the population can't afford to do.
So, let's think about this a bit by way of comparing two people:
Joe College studies hard throughout his high school days so he can get into college. His parents make sacrifices to pay and maybe Joe even has to also get a job and work while in college. Throughout those years, he studies hard and sacrifices most of his time to his studies. The end result is he now makes more money than those who don't go to college.
Billy Bob spent his high school time without study and managed to get a diploma because political correctness wouldn't allow teachers to flunk him. He devoted his time to chasing girls, racing cars, hanging out with rock music. He had no desire to go to college and because of his life choices, wouldn't qualify anyway. So, he is now a gas station clerk.
So, somehow you say this means that it is fair for Joe to have to pay a lot more tax than Billy?
I don't believe in meritocracy. I believe in equality.
While it may be true that Joe worked very hard to get where he is, and Billy Bob was a jerk off, chances are greater I would wager that Joe got ahead not because of his hard work or his parent's sacrifice, but because his parents were well off themselves, well connected, or both.
And I don't think Billy Bob can entirely be blamed given the enormous cost of higher education in this country. If higher education was free like grade school was, then your argument would carry more weight, but as things are, I can't agree here.
I would note that class mobility is extremely low in this country, perhaps the lowest in the industrial world. So what does that tell you about how useful hard work is in making you wealthy? If it did work, then coal miners would be millionaires.
First off, Joe's parents had to sacrifice to get him into the college and he had to work. That doesn't sound like the parents were well off or well-connected. Well off and well-connected don't have the kind of struggle as was outlined. So you would lose your wager.
Second, Billy Bob CAN be to blame because HE chose to play around during school; the stupidity is now his alone. It has nothing to do with the cost of higher education. If he were of a mind to do so, he could always go to the community college.
Third, if higher education were free like grade school, Joe would STILL study hard and Billy Bob would STILL goof off.
People are, as a general rule, either ants or grasshoppers by the time they get out of high school. That's not to say that some grasshoppers don't become ants and vice versa, but as a rule, by high school's end, those who worked hard in it, will work hard out of it.
Wealthy people consume more resources so they should be taxed higher. Only country in the world where tax is completely misunderstood and used for political gain. US tax is not high compared to many industrialized countries.
You can't have the best of infrastructure (which we don't any longer) and the best defense without taxes.
Without calling names, the cut tax mantra is what got us in this huge mess.
I consume much more than most, a consumption tax might actually "raise" my taxes. I have no objection whatsoever to a tax on my consumption.
If I consume more than my share, I see no reason why I should not contribute proportionally.
He was the one that stated that rich people consume more resources, not me.
Besides your definition of "regressive" is any system in which rich people don't pay through the nose. I can pretty much guarantee you that I pay more in taxes each year than you earn in a decade, but that's still not enough for bloodsuckers like you.
The good news is that even your liberal bretheren are already disillusioned with the present leadership and will most likely vote them out of office before any more serious damage can be done.
This will be my one post in direct response to you, I will now go back to ridiculing you instead of talking to you, as promised.
is the reason for indexing higher tax rate for the rich is because, they consume more than the poor.
Not to tax consumption.
Typical!
Rich and poor pays the same % and no way of indexing it. One potential way it might work is not to tax any essential items and tax the hell out of luxury items.
Very difficult to implement and could end up killing businesses producing luxury items.
Just like Flat Tax, looks good on paper but not practical.
I do not advocate a consumption or flat tax for the very reasons you mention.
My comment about a consumption tax was not a serious one, it was more along the lines of "if the rich are such consumers, why not simply tax the consumption?" All simplistic and sarcastic answers are almost by definition bad, and incomplete solutions.
I don't really have any problem paying more than my fair share, I have been doing so for decades and still have managed to do all right. What does irk me however are idiots like Willie who never think enough is enough. Left to morons like Willie, there would be no economy, PERIOD.
Just because he is a loser, he believes that there should be no winners. That is as unamerican a mentality as has ever been opined here.
Just a question AF, How much do you think is enough for "rich people" to pay. 50%? 60%? 100%, Where do you think the threshold should be? I mean this a serious question, and I will allow for the different kinds of rich. ie Trust fund baby who makes $50 million a year from inherited wealth as opposed to a business owner who starts from scratch and through hard work creates numerous jobs and is basically "the American Dream" come to life, and by doing so becomes "rich".
Plugging tax loop holes for the rich. If they move money out of the country, tax it to make it unattractive. Overall the rate should be capped around 35% t0 37%.
I do believe our current tax code has way too many loop holes for the rich to evade taxation.
Having seen the result of dynastic families in England being able to essentially buy government - business entities as well, i.e. the East India Company - they wanted to make sure that nobody in this new nation could amass such great wealth that they could exert undue influence or make policy that benefited them at the expense of the average man.
Roosevelt as well spoke of the 'economic royalists' who would enslave the American working man:
"The royalists of the economic order have conceded that political freedom was the business of the government, but they have maintained that economic slavery was nobody's business. They granted that the government could protect the citizen in his right to vote, but they denied that the government could do anything to protect the citizen in his right to work and his right to live."
"These economic royalists complain that we seek to overthrow the institutions of America. What they really complain of is that we seek to take away their power. Our allegiance to American institutions requires the overthrow of this kind of power. In vain they seek to hide behind the flag and the Constitution. In their blindness they forget what the flag and the Constitution stand for. Now, as always, they stand for democracy, not tyranny; for freedom, not subjection; and against a dictatorship by mob rule and the over-privileged alike."
Too much money in the hands of the few amounts to a new royal class - and this nation was founded on the destruction of the Royalists.
-- Modified on 2/2/2010 1:53:21 PM
differently. Equal protection requires only that everyone in the segment be treated the same.
Going deeper, as long as the legislature has a rational basis, for a classification, the classification is valid, unless a fundamental right is involved or a protected class is impacted.
Certainly, there is no fundamental right to pay the same taxes and the progressive system is applied equally to all protected classes, so all that is necessary is a rationale basis for the classification. That basis is greater wealth means greater ability to pay more.
Further, while I cannot remember the details, the 16th Amendment overruled a Sup Ct striking the progressive tax on Article I uniformity grounds. So aside from those wackos who keep insisting the income tax is unconstittutional, I think the constitutionality of the progressive tax is pretty well established.
Amendment 16 - Status of Income Tax Clarified. Ratified 2/3/1913
"The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration."
The problem is that if we tried to level the tax field, then taxes would go down for the wealthiest, but would skyrocket for everyone else to compensate for the lost revenues. A level tax - either a flat tax or national sales tx - would cripple the middle class, and destroy the lower class.
Now, if we didn't have a federal gov't that was so massively overbloated that it makes Jabba the Hutt look like an anorexic, we could probably swing it. First though, we would have to massively cut spending, and pay down our overwhelming debt.
I constantly chuckle over the fact that even the King of England, whose ass we kicked, only demanded the "king's fifth" or 20%. Today the majority of Americans would weep for joy to only give up 20% of their income to Uncle Sam. Even the poorest among us pay around 10% of their income in taxes.
Let us say Federal Government no longer provide any aid to states for anything, including when disaster strikes. All states are on their own for roads, disaster management, health and human services, interstate commerce, aviation, etc.
How ]do you think that will work out. You have got see the big picture, not just what you like to see.