OGRESSIVITY OF FLAT TAXUnder the flat tax, the more you earn, the more you pay. In fact, because of the high family exemption, the more a taxpayer earns, the greater the share of his income he pays in tax. A family of four earning $25,000 would owe no tax under the proposal. A family of four earning $50,000 would pay only six percent of its income in income taxes while a family earning $200,000 would pay 14 percent. The flat tax eliminates the marriage penalty and nearly doubles the deduction for dependent children. By ending the multiple taxation of saving, the flat tax provides all Americans with the tax equivalent of an unlimited IRA. This will make it easier for families to save for a home, a vacation, a college education, or retirement.The bill repeals the current income tax in total and replaces it with a low, simple flat tax. Under the bill, every dollar of income in the economy is taxed one time at the same rate. Wage and pension income is collected from individuals. All other income, including investment income, is collected from businesses. Business owners pay the same tax rate and would file an equally straightforward tax form.COMPARISON BETWEEN FLAT TAX AND THE CURRENT TAX SYSTEMINCOME TAXFLAT INCOME TAXCOST OF FILLINGExpensive! Costs $600 billion plus per year.Somewhat reduced.COMPLEXITYVery complex! Over 2,000 Internal Revenue Code pages, 12,000 pages of regulations and 200,000 Court pages.Withholding continues. Individuals and businesses must still track income and file tax forms.HOURS TO COMPLYOver 5.4 billion hours per year.Reduced depending on the flat Tax plan.PENALTIESSevere, arbitrary Severe, arbitraryECONOMYIncreases prices, hurts wages results in decreased savings and investment.Tax burden still hidden in goods and services. No increase in wages.INTREST RATESPushes rates up by reducing savings.Pates reduced if investment income not taxed.INVESTMENTLow.Increased if investment income not taxed.JOBHurts U.S. compani...
