ther than alleviating the plan’s regressive nature, this aggravates it: A large share of the income of the wealthiest Americans would not be taxed at all. That would leave middle and low income families holding the bag. (McAfee 94)Under the flat tax, many of the wealthiest individuals would pay absolutely no tax. For example, a family whose income consists solely of millions of dollars of dividends, interest, and gains from the sale of stock held investment would pay zero tax. (Robertson 24)Non-business gains from investments, not only in stock, but in such assets as bonds, land, options, futures, antiques, and collectibles would be tax-free. While it may be unintentional, it appears that rental income would be tax-free under the bill. Also, outside the context of a business, income from lottery and other gambling activities, theft, embezzlement, bribery, and many other sources apparently would not be taxed. Yet for the employee who loses a job, unemployment compensation would be taxable. (Robertson)It is hard to imagine why so much income should escape taxation while, for people who work for a living, wages, and salaries should be taxed. And for those who take some comfort in the fact that public officials who take illegal bribes are currently subject to tax on them, with possible penalty for tax evasion, the idea that these bribes would apparently be tax-free is certainly troublesome. It is also worth noting that, for the politician who withdraws money from a campaign fund for personal use, even if it is unlawful to do so, this is taxable under the present law. But it appears to be tax-free under the flat tax. The typical wage earner certainly has the right to be skeptical about this “fair and honest” tax. (Robertson 26)In conclusion, it is clear that the flat tax rate is not a good concept which would be beneficial to the people. The current tax system, for now, is by far the better choice....
