A reader writes:
Almost every advocate of the flat tax (correct me if this doesn't include you) is actually proposing a progressive tax with two brackets. These are a 0% bracket for all income below a minimum threshold (which may based on family size), and a bracket of x % for all income above that threshold. Once you have accepted the necessity of this level of progressivity, what's so much more objectionable about having three or four brackets?
My main problem with the flat tax proponents is that they have so strongly linked tax simplification to flat taxes that they have poisoned the well for simplification advocates. While virtually everyone who advocates flat taxes also wants tax simplification, there is also a large constituency (perhaps larger) that wants tax simplification while maintaining progressivity. These constituencies should join together to achieve what may be politically possible -- a massive simplification of the tax code with minimal deductions. Most flat taxers would agree that tax simplification will do much to alleviate inequities in the tax system, even if the current level of progressivity is preserved.
Yes, in most cases a flat tax would indeed exempt those below a certain level; and yes, removal of deductions and simpler taxation is a cause worth pursuing. The two belong together, especialy since the complicated tax code always benefits those with large amounts of wealth (hence effectively as unfair as progressive taxation). The model was the 1986 tax reform. The one exemption I'd keep is charity. Imagine if the only way to exempt income from taxation was to give it to charitable enterprises.
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