A brilliant little blog.
EMAIL OF THE DAY: “Too many people misunderstand how a flat tax would work and fight it based on that misunderstanding. There are two key points that should be understood:
1) It would truly be simple. Most versions of the flat tax call for the elimination of all deductions except for personal exemptions based on the number of family members. There would be no calculation of mortgage interest, property taxes, health costs, etc. Taxpayers would simply determine their earned income, subtract their personal exemptions, and pay a tax on the balance.
2) It would ultimately be progressive. While the tax rate would be flat, the effective rate paid would be progressive with income. Most flat tax proposals provide for an exemption of $7,500 per family member, or $30,000 for a family of four. A family of 4 with an income of $30,000 would pay no taxes for an effective tax rate of 0%. Assuming a 17% flat tax rate, a family of 4 with an income of $50,000 would pay a tax of $3,400 ($50,000 – $30,000 = $20,000) for an effective rate of 6.8%; that same family with an income of $100,000 would pay a tax of $11,900 for a rate of 11.9%; and if their income were $1,000,000, they would pay $164,900 for a rate of 16.49%.
Opponents should give up complexity and lack of progressiveness as reasons not to have a flat tax. They’ll still be able to make opposing arguments such as “I want my mortgage deduction;” rich people should pay more than 17%; and we should always tax people more rather than reduce government spending.
There’s one other reason for a flat tax with no deductions. Congress loves to tamper endlessly with the tax code. Lobbyists and PACS are forced to wine, dine, and donate to protect their industries, or carve out exceptions that apply only to their clients. Tampering generates millions in the way of campaign contributions. A tamper-proof, flat personal and business income tax would eliminate at least a third of the influence peddling that makes Congress seem so sleazy.” More feedback on the smartest Letters Page on the web.
The Dish 