?The Flat Tax’A Reaction Paper The article on the Flat Tax system was actually one that I could relate to in terms of personal taxes. I have heard of this ?new’ system over the last five or six years, but I still have yet to see any type of action for implementation with this system.
Before becoming ?enlightened’ about the new system through this article, I believed that the Flat Tax needed to be adopted by our government and adopted immediately. The thought of only paying fifteen percent to taxes is something that I relished. I always thought that a straight fifteen percent tax across the board would be fair and adequate for our system. I never truly understood the consequences the flat tax made upon the debt. This, again, was all before reading the article in depth.
I appreciated the fact that the author presented numerous facts and examples when he spoke of the advantages and disadvantages of the flat tax. Some of these disadvantages I would never have known if not for this article. Most of us hear of a new tax system and without knowing the details, we want to jump into the new system believing that it will help all of us save some of our income. Obviously, by employing this system, it will save us some income but in the end, we will be paying higher taxes for other essentials. Taxes will be paid by the consumer either on payroll or through the purchases of durable and non-durable goods. There is no way around it.
One way or the other we are paying the taxes to support our country. The other astounding fact that I received from the article was that the fifteen- percent would not even come close to supporting our country. In fact, the country would be losing billions overall. In order to support the country, the flat tax would have to increase almost up to twenty-seven percent! Most people would probably not agree with this data. When I traveled to Ireland last winter, I noticed that when I purchased something a VAT tax was imposed.
I thought to myself, I could never live here and pay this additional tax on my purchases. Little did I know that this VAT tax was part of a flat tax system. I understand how the VAT tax helps keep the debt from rising out of control, but there must be others ways of controlling this. I have also visited other countries that have the same type of flat tax system and they also have other means of reclaiming the taxes lost in the flat tax.
Canada, for example, has their people pay a large tax on their purchases and for entertainment, such as dining. In the long run, a flat tax looks like a system that all taxpayers would want. However, most of these taxpayers will be in the same situation that I was in, not enough education on the process. This places us at the disadvantage and helps us make decisions based on false presumptions. I believe that the tax system needs to be corrected and simplified, but this new and simplified system needs to be equitable for all.
How can this be done? This is something that needs to answered by the experts and promoted by us.BibliographynoneEconomics