Budget Cut Protestors - Help Me Understand

[giblets]

Well, Dauphin, to be fair it's more that the average taxpayer/voter doesn't understand what progressive taxation is. They would likely say they support it because if it's "progressive" it has to be good, right?

It's much more likely that, if explained properly, the average taxpayer/voter would be in favor of a flat tax - that is, everyone pays the same percentage, meaning that the poor pay less and the rich pay more. This is the only fundamentally fair tax system available, anyway, and assuming all loopholes are closed there have been studies showing that a flat tax system would actually INCREASE tax revenues.

And what do you base this assumption on?

[giblets]

[David Floyd]

I would suggest such a thing. I would be astonished if a flat tax could get passed into law as too many voters would be fearful of paying more. Flat tax seems a big vote loser.

The only people who would pay more under a flat tax system would be the rich, given that most flat tax proposals also include measures to close the loopholes that the rich use to get out of paying taxes. I'm also in favor of a flat tax system with a provision for those making under a certain amount - say, the federal poverty line - pay no taxes whatsoever.

Hell, I'm firmly middle class, and a 17% flat tax sounds pretty good to me. If some rich people end up paying proportionately less, good for them. Unlike some people I'm not out to get rich people. If a system will a)generate more tax revenue, b)cause me to pay less in taxes, and c)be more fundamentally fair, then I'm all for it as I would think most people would.

gribbler,

What, it's shocking to you that poor people think they pay too much in taxes, and that those better off than them pay too much? Wow, really? You can word a poll to create any result you want. Ask the exact same people the exact same question in a different way, and odds are you get a different result. Ask the exact same people if the would support an across the board 17% flat tax, a tax exemption for those under the poverty line, the closing of tax evasion loopholes, and tell them that such a system would actually increase tax revenue, and most of them would say yes. Hell, who wouldn't?

[Egbert]

I wouldn't. I would call b*ll****.

[David Floyd]

However, the comment that a flat tax could never get passed is, of course, accurate. The rich would never support it because it would involve closing their tax loopholes, and the poor would never support it because the left would spin it as tax cuts for the rich.

[David Floyd]

I wouldn't. I would call b*ll****.

How would a system in which the rich are forced to pay their fair share (and by fair I mean the same as everyone else), rather than escaping through loopholes, generate less revenue? In the current system, you can slap whatever progressive tax rate you want on the rich, and it's all theoretical, because they are finding ways not to pay it anyway.

[Egbert]

I think there may be a great deal of suspicion towards a flat tax on the part of poor people and the middle class. A suspicion that any push for a flat tax is a stunt by rich dudes to pay less tax. I am not even sure the "left" would need to spin it as tax cuts for the rich (or maybe they already did and their message got through). Yeah, I agree the rich would be worried about their tax loopholes.

[Egbert]

How would a system in which the rich are forced to pay their fair share (and by fair I mean the same as everyone else), rather than escaping through loopholes, generate less revenue? In the current system, you can slap whatever progressive tax rate you want on the rich, and it's all theoretical, because they are finding ways not to pay it anyway.

See above quote. I would think it was a stunt. I would foresee a flat tax with loopholes for the rich followed by an increase in the tax rate. I would fear the middle class may finish up paying more.

[David Floyd]

The suspicion would be entirely generated by the media and the left. Again, I firmly believe that if you asked 20 random lower and middle class taxpayers "Would you be in favor of a tax system in which everyone paid 17% except those below the poverty line, with no loopholes?" the answer would be majority PRO.

If the media and the left were given the opportunity to spin this into "Would you be in favor of a system that would lower the tax rate for the wealthy?", then of course the majority would be ANTI.

It's all in the wording and the bias of the person asking the question.

[giblets]

gribbler,

What, it's shocking to you that poor people think they pay too much in taxes, and that those better off than them pay too much? Wow, really? You can word a poll to create any result you want. Ask the exact same people the exact same question in a different way, and odds are you get a different result. Ask the exact same people if the would support an across the board 17% flat tax, a tax exemption for those under the poverty line, the closing of tax evasion loopholes, and tell them that such a system would actually increase tax revenue, and most of them would say yes. Hell, who wouldn't?

We currently have a "progressive" tax system, and the public thinks upper-income people pay too little and lower-income people pay too much. It's clear from the poll results that only a tiny fringe wants a flat tax. If you really think people are stupid sheep who only want a progressive tax system because "progressive" sounds good and they can be manipulated to say whatever a pollster wants, what basis do you have for claiming you know what kind of tax system they really want?

Of course, if you really want a "tax exemption for those under the poverty line" then even you support higher tax rates for people who earn more.

I'm sure everyone who isn't a tax evader would like to close loopholes. That has **** all to do with flat vs. progressive taxation and I don't see any reason to mention it except as an attempt to skew the results.

How would a flat tax increase revenue? Magic?

[David Floyd]

See above quote. I would think it was a stunt. I would foresee a flat tax with loopholes for the rich followed by an increase in the tax rate. I would fear the middle class may finish up paying more.

Assume it's not a stunt. Assume it's a real proposal. Are you still against it?

[Hauldren Collider]

The only people who would pay more under a flat tax system would be the rich, given that most flat tax proposals also include measures to close the loopholes that the rich use to get out of paying taxes. I'm also in favor of a flat tax system with a provision for those making under a certain amount - say, the federal poverty line - pay no taxes whatsoever.

Slightly progressive tax schemes are probably a good idea because after a certain amount of money earned, money starts to become less valuable on the margin to the earner. (I think, is that right?)

[David Floyd]

We currently have a "progressive" tax system, and the public thinks upper-income pay too little and lower-income people pay too much.

And again, "the public" you are referring to is by and large the lower and middle class. Of course they think they pay too much and the rich pay too little. Ask the rich the same question and you likely get the opposite result.

It's clear from the poll results that only a tiny fringe wants a flat tax. If you really think people are stupid sheep who only want a progressive tax system because "progressive" sounds good and they can be manipulated to say whatever a pollster wants, what basis do you have for claiming you know what kind of tax system they really want?

I don't think people give a flying **** about terms like "progressive tax rate" and "flat tax". They do care about how much they pay in taxes, and many of them care about how much they pay vis-a-vis others, especially the much-villified (by the media and the left) rich. However, I do think that the majority of the voting public ARE stupid sheep who can be manipulated into saying whatever a pollster wants, that's true. The flip side is that I see no way they would be against a tax system with no downside to them - ie, the flat tax.

Of course, if you really want a "tax exemption for those under the poverty line" then even you support higher tax rates for people who earn more

Actually, not really - I'm just trying to compromise a little with those who will argue about the truly poor paying much higher taxes in relation to their disposable income, and all that.

I'm sure everyone who isn't a tax evader would like to close loopholes. That has **** all to do with flat vs. progressive taxation and I don't see any reason to mention it except as an attempt to skew the results.

How would a flat tax increase revenue? Magic?

Yes, naturally a flat tax on it's own would not increase revenues, and naturally you could increase revenues by closing loopholes in the current system. My argument is simply that a flat tax is far more fair, especially to the middle and upper classes, than is a progressive tax system, and as long as loopholes are closed would be a better alternative, revenue-wise, to our current system of a progressive system with loopholes.

Certainly, our current system with no loopholes would generate more income than a flat tax with no loopholes - however, such a plan is just as pie-in-the-sky as a flat tax. Furthermore, I believe a progressive tax system to be fundamentally unfair. A flat tax with no loopholes provides the best of all worlds - more revenue, more clarity/simplicity, and more fairness in the tax system.

[Hauldren Collider]

I think there may be a great deal of suspicion towards a flat tax on the part of poor people and the middle class. A suspicion that any push for a flat tax is a stunt by rich dudes to pay less tax. I am not even sure the "left" would need to spin it as tax cuts for the rich (or maybe they already did and their message got through). Yeah, I agree the rich would be worried about their tax loopholes.

The whole tax system right now is a stunt by the middle class to pay virtually nothing. Honestly, the tax base is so narrow right now it would be funny if it weren't infuriating. Anyone saying that the rich don't pay their share should probably go **** himself, preferably with something sharp.

[giblets]

The only people who would pay more under a flat tax system would be the rich, given that most flat tax proposals also include measures to close the loopholes that the rich use to get out of paying taxes. I'm also in favor of a flat tax system with a provision for those making under a certain amount - say, the federal poverty line - pay no taxes whatsoever.

Slightly progressive tax schemes are probably a good idea because after a certain amount of money earned, money starts to become less valuable on the margin to the earner. (I think, is that right?)

I would think that the marginal utility of income always decreases as income increases. Why would the marginal utility not decrease before a certain point?