Solution+-+Flat+Tax


 * __SOLUTION: FLAT TAX __**

__Main Ideas: __ Some of the ideas presented are that if a flat income tax was set at 19% would it be more fair or should they keep the current tax system where your income tax is based off of how much you make.

__Positives: __ Some positives for this are that everyone will have to pay the equal amount of money for their income tax. Also, the EITC (Earned Income Tax Credit) would benefit those who are considered low income because it gives money back to them if they have a child and make under a certain amount of money.

__Negatives: __Some negatives of this are that it may not be considered fair for everyone because those who make a larger income do not have to pay nearly as much in comparison to those who make a middle to low wage income. Also, with the amount of deficit right now, the flat tax would actually have to be set at about 21% to 30% in order to make up the deficit. Lastly, with the growing number of baby boomers who soon will qualify for medicare/medicaid, the flat tax will have to be set high enough to pay for that as well.

__For: __ This tax would most likely benefit the higher income people because they will have larger cuts in their income tax.

__Against: __This tax would be against the middle to lower class because they would be spending the same amount of money on their income tax that people who make almost twice the income as them are. Also, they could be spending what would be a big chunk of their income but to a wealthier person not much at all.



__** The Optional Flat Tax **__ By: Sam Brownback


 * Summary: **

This article discusses the impressive qualities of the optional flat tax. People can choose to go by the flat tax. It expresses how much the flat tax would help with economic growth and would be simple and good for families. This type of tax would serve as an alternative maximum tax, which is a solution to the need of AMT (Alternative Minimum Tax). The optional flat tax would offer a generous personal income exclusion indexed for inflation. The author emphasizes that this solution would be politically viable and economically sound. The proposal of this tax would protect and ensure a strong economy. This optional solution is used in Hong Kong, who has two syustems. The flat tax is the most commonly picked system there, and there is a strong income tax structure present in Hong Kong. The optional flat tax is the path to go by when looking for a solution.

By: Richard A. Epstein
 * __ Favoring a Flat Tax __**


 * Summary: **

This article dicusses the wrong turns that president Obama is currently makeing int he tax area. Instead of treating all of the people equal, he is putting all of the pressure of taxes on towards the higher income individuals. He wants to decrease the taxes paid by middle class and the poor, and increase taxes for the wealthy. Having a flat tax would fix the distortions that other unequal taxes would cause if two different individuals were to recieve to different after-tax returns on their labor or investment. This seems like the fair way to go, have everyone pay the same taxes. They would be reasonable and realistic, and there is no singling out anybody who has hgiher incomes. Also, the flat tax makes it hard to give the rich speacial treatment in the area of political discretion. Therefore, Obama should turn to the flat tax instead of what he is currently doing with taxes.

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 * __Resources:__**


 * __Group Members:__** Stephanie Mettler and Ian Gimbar