The United States is the third largest country in the world with just over three hundred and twenty-three million people. If all of these people have jobs and have an income, they will be taxed at the beginning of each new year. In order for our nation to run properly we need a budget and that budget comes directly from our incomes through the tax system. The tax system is a very complicated system that many believe needs to be changed, by instilling a flat tax system. A flat tax system is a system in which everyone in the country is taxed at the same rate regardless of their income.
Many believe that it is the best system as it is quick, simple and fair because no one is taxed at a higher rate solely due to the amount of money they make. The flat tax system should not be implemented in the United States as it is unfair, unproved and is not supported by a majority of it’s citizens. The United States currently operates under a progressive tax code which was shaped by the Obama administration while he was in office between 2008-2016. There are currently seven total tax brackets in the system, all varying in percentage.
The percentage at which you are taxed is dependent on the total amount of income a person brings in that fiscal year. For example, if a person who is not married/single makes between $37,950 to $91,900 they are taxed $5,226. 25 plus 25% of the excess over $37,950 (Pomerleau). Each bracket has different incomes in it with a different percentage associated with that income level. This way of doing income taxes is very beneficial for some and less so for others. The large majority of people who benefit from a progressive tax system are in the bottom three brackets, as they are taxed at a lower rate than those who make a lot more money.
Although the current tax system is much more complicated than that, making it very hard to understand what is really going on. This is one of the many problems, many Americans end up having to hire someone to do their taxes as they often take hours upon hours to file correctly which has lead to a degree of discontent. Yet, despite all of these problems there are solutions that are more feasible than a full on switch to a flat tax system. The flat tax brings about a system that we have been attempting as a country to avoid, at least while we had a democratic president who leads towards being progressive.
Although many Republicans will disagree with it, the concept of a flat tax system will “certainly benefit high income houses with a large amount of investment income more than the middle and lower classes that rely on wages alone” (Salam). A flat tax system will provide an advantage to those of the upper class who often rely on investments for income as well as wages. With a lowered tax on investments this will provide them with both a lower income wage tax as well as investment taxes resulting in these people keeping a larger sum of their money.
Those in favor of a flat tax like to avoid this and instead talk about how it has been successful in other nations. There are currently twenty four countries that have implemented a flat tax, “fifteen of these countries are formerly Communist countries of Eastern and Central Europe. The others are very small, ranging from Montenegro to Iceland. No major industrial nation has made that choice” (Ulbrich). The flat tax system is largely unproven, as only small developing nations have successfully used it.
If the United States jumped into a system like this it bring about disastrous results to the national economy. To take a risk like this would be very foolhardy, especially without the backing of the majority of American people behind this system. In a country of over 300 million people, a majority of people’s support is often desired before a bill or plan such as a new tax code is implemented. According to The Wall Street Journal, upon conducting a poll only 28% favored a flat tax and 39% opposed it while the rest weren’t sure.
The flat tax has historically held a large amount of uncertainty when it comes to people’s support, as it is relatively unproven. The idea of a flat tax is much more popular with Republicans with 48% issuing supporting towards it, yet although it is proposed over and over again every election recently by Republicans. They still do not hold a majority of support even among those who are registered Republicans (Brady). Despite all of these reasons there is still a large amount of support for the flat tax among the people and the 2016 GOP candidates.
Rand Paul, Kentucky Senator and former 2016 GOP candidate was an avid supporter of a new flat tax during his campaign. He states that the “tax code has become so corrupt, complicated, intrusive and antigrowth that I’ve concluded that the system is not fixable. So, I am announcing an over $2 trillion tax cut that would repeal the entire IRS tax code- all 70,000 pages” (Paul). Our tax system is way over complicated as Rand Paul states here and needs to be simplified and he provides a way in which he will do so.
When installing this flat tax he will get rid of payroll taxes which will provide a great incentive for employers to hire more workers which will lead to economic growth. The economy in the United States has been very up and down over the past ten to twenty years but this will lead to economic growth through job creation and tax revenue. Taxes have also gotten ever more complicated over the years as additional tax brackets have been created as well as taxes on investments, estates and inheritance has become more common and complicated for those who have them.
Republicans lawmakers would like to simplify the tax system to the point in which people are able to fill out their taxes on a “postcard in five minutes and small businesses can concentrate on expanding their business rather than jumping through hoops in the tax code” (Armey). These are a few of the reasons as to why it is time for a flat tax system in the United States. There are many reasons for and against the adoption of a flat tax in the United States but the bad outweighs the good. Despite the fact that a flat tax would usher in an era of easier taxing as well a possible economic upturn it is not what America needs at this stage.
America is an ever changing social and economical nation in which there are all sorts of people of different economic levels and backgrounds. A flat tax would not benefit those who are of a lower class but only those of an upper class; a miniscule percentage in our country. America is currently experiencing an economic upturn which could be ruined by risking blowing up our tax code to something as risky and unproven as a flat tax, which is not even supported by a majority of Americans. In conclusion, the United States should not switch to a flat tax as it is unfair, unproven and is not supported by a majority.