IssuesMatch
Make Income Tax Flatter & Lower
POSITIONS
- Strongly Support means you believe: Ideally, the income tax and the IRS should be abolished. Perhaps a national sales tax is a good replacement. Lower and flatter taxes are a good first step.
- Support means you believe: A Flat Tax would simplify the entire tax system. It would get rid of loopholes that drive tax-avoiding behaviors. And it would remove most deductions and the special interests that come with them.
- Oppose means you believe: Flatter taxes benefit the wealthy more than the lower and middle class. We should focus tax relief on the majority of taxpayers instead of on the richest few percent, while preserving important deductions like mortgage interest and charitable donations.
- Strongly Oppose means you believe: A progressive income tax is one of the cornerstones of modern society. Its premise is that the wealthy contribute proportionally more than those with lower incomes. That is the right way to run our tax system, and we should keep it that way.
This question is looking for your views on reducing the power and size of the IRS. However you answer the above question would be similar to your response to these statements:
- A National Sales Tax is better than an income tax
- Support tax simplification
- Repeal the 16th Amendment
BACKGROUND
Tax Rates
- Marginal Tax Rates means the amount you pay on each taxable dollar earned above the deductible base.
(Decreasing the marginal rates would decrease the amount everyone pays, but in general would favor those who pay more tax).
- The current marginal tax rates are 15% on the first $42,350 of taxable income, 28% on the next $60,000, and 31%, 36%, & 39.6% above that.
(Those are the Married Filing Jointly rates. The same marginal rates apply to singles, but at different breakpoints).
- The Marriage Penalty means that two people filing together pay more than if they filed as two singles separately.
- The most debated deduction is the mortgage interest deduction (applicable to everyone who owns a house; it makes buying a home more affordable by subsidizing 15% of the mortgage).
- The charitable deduction is the basis for discussions of Faith-based organizations replacing government agencies.
- The Inheritance Tax or Death Tax is the basis for discussions of Family Businesses.
- The Capital Gains Tax is a separate income tax (with a maximum marginal rate of 28%) which applies when goods that have gone up in value are sold. Lowering the capital gains rate is considered a benefit to wealthier taxpayers.
Flat Tax & Sales Tax
- A Flat Tax would replace the current progressive marginal rates with a single flat rate (plans vary from 10% to 17%), applied after a deductible base.
- Flat Tax plans can achieve lower rates by removing the mortgage interest and charitable deductions.
- A National Sales Tax would replace the income tax with a consumption tax paid when purchasing anything. Many European countries implement a form of sales tax called VAT, or Value-Added Tax.
Tax Surplus
- In August, Congress passed a $792 billion tax cut package to be spread over 10 years. President Clinton promised to veto it in September.
- From 2000 through 2009, the total budget surplus is now anticipated to be a cumulative $2.93 trillion.
Amendment XVI to the US Constitution
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. (1913)