Flat tax is better than what we have now, but I'd prefer a national sales tax that exempts basic foods and meds. Nearly anything is better than what we've got now though!

I've argued that a flat tax based off regional poverty levels for your family size would be the fairest system.

Anything you make over 125% of the poverty level is taxed at 22% (18% fed, 3% state, 1% local).

If a family of 4 is $20K for poverty level, then anything above $25K is taxed. So if you make $80K, plus $10K from investments, minus $1K for property taxes. That means ($89K - $25K) * .22 = $14K.

Subtract/add that from your weekly payroll deduction and you are done. Not quite a postcard, but not much more.

This problem is so nasty nobody will address it, precisely because they're scared they won't be the favored party. Too many believe they pay nothing. Too many actually do pay nothing.

Just wait until churches discover 503(c) goes away.

Flat tax would definitely be better than what we have now...I think it would reign in government spending because everyone would have a stake in it, exempting people creates a large constituency of people who are always for more spending and entitlements because they benefit and someone else pays.

However, I agree with momof4, a sales tax would be better. Not only would it encourage labor and savings, everyone would actually see the green leaving whenever they bought a $5 item and had to pay $6 or $7. It would also cause all the illegal aliens and people working for cash (especially those who also live off entitlements while working for cash) to pay taxes. Talk about backlash against overblown spending, if every American could see what they are actually paying every day in real dollars. Not to mention, a drop in taxes would instantly boost the economy. Of course, we'd have to repeal the 16th amendment or we'd soon find ourselves paying both a sales tax and an income tax.

"everyone would actually see the green leaving whenever they bought a $5 item and had to pay $6 or $7."

Which is precisely what the government doesn't want.

Your paycheck has taxes taken straight out of it; you never see the money, in your head, it doesn't exist. People love getting a fat rebate check, not realizing all they've done is gotten their own money back, having given the government an interest-free loan.

It's the taxes people SEE and manually pay that they complain about the most. Property taxes, sales tax, etc. Income tax is this magic nebulous thing that just HAPPENS, and most people don't really grasp, so short of a bit of whinging on 4/15, it's largely ignored. If people had to cu that tax check every April, you'd see some demands for change BUT quick.

A flat tax is a strong idea. Simplifiy the tax system, take away a lot of the ways the wealthy can shelter or hide their income so they pay tax on what they're supposed to, and that's it.

But like tobacco and so many other things, there's way too much money being made on taxes, not only from the government but by HR Block, TurboTax, accountants, etc. The complicated system generates jobs for people who can understand it.

One problem with the flat tax as usually described is that it misses 90% of the problems of the current tax system, which is measuring income in the first place.

Line 1: How much money did you make
Line 2: Multiply line 1 by 10%
Line 3: Send it in.

The flat tax addresses line 2, but doesn't seem to address various tax loopholes, tax shelters, or various other ways of hiding income from being measured.

Address line 1, and I'm willing to discuss line 2, though I'll note that our richest Americans think they should be taxed more, not less, and that our current line 2 system is a whole bunch flatter than many many times in the past.

Off topic,

Amy, I don't know how often you read Atrios, but I think you and he may agree with each other regarding unpaid internships, and so, apparently does the Obama Administration and many State
Labor Commissioners.

http://www.eschatonblog.com/2010/04/unpaid-internships.html

A lot of loopholes would be gone. No housing credit, no child care credits, and a lot of others are gone.

Yes, a lot of the loopholes and tax credits would be gone. That's a good thing. One good thing about a flat tax is that it would reduce the influence of politicians.

Politicians are constantly playing this games of favors, giving away credits to this group or that group to get votes or to bring about behavior that they think is 'good' or to punish people (those evil business executives or whatever the demon of the week is). We then see our welfare dependent on the welfare of whatever politician will give us the most tax breaks. We're dependent on their goodwill rather than the other way around.

I own a house so I get a credit on the interest I pay. Is it fair that people who rent should, in effect, pay a higher tax rate than those who don't? Politicians say that home-ownership does all sorts of good things for a community. (It was this thinking that caused politicians to come up with that great idea of getting more people to own homes by pressuring banks to lower their lending standards. And that's worked so well!) Do I want to give up my tax credit? At theses rates and in this economy, hell no. So, in sense, they've got me, by playing favorites, renters vs homeowners.

One couple gets married, has kids and decides that one of them will work while the other stays at home to care for the kids. Their lives, their choice. Another couple gets married, has kids and decides that they'll do better with 2 incomes, so both work. Again, their lives, their choice. But politicians decide that family #2 should get a tax break for child care expenses. If you assume similar people from similar backgrounds,family #1, with 1 income is making less money than family #2, but in effect, pays a higher tax rate because politicians think the lifestyle of #2 should be subsidized. Stay-at-home moms vs working moms.

A flat tax would take away some of the power of politicians to manipulate us. Much of politics today is about government taking money from us then giving some of it back with strings attached, Washington making us perform stupid human tricks in hopes of being rewarded. A flat tax or sales tax would be good. I'm not sure which would be best. A sales tax could be regressive, but it does have the advantage of being very visible, as some here have mentioned. This is why the politicians are going to be pushing the value-added tax (VAT). Tax is added at each level of production, as value is added to an item. Taxed as raw material, taxed as it's refined, taxed when it's made into a widget, taxed as it's added to a gadget (as I understand it). The price of everything goes up, but you won't know how much tax you're paying because it all gets rolled into the base price. That's why the politicians like it; that and all the cool kids in Europe are doing it so we should, too.

The reason the VAT disturbs me is at which level do you stop taxing it?

What if you run a second-hand store -- is that taxed? What about antiques?

What about private sales?

The income tax at a flat rate is understandable and if congress or the states it is clearly visible to all.

Another question is internet sales. What if I setup a store in Nevada? No sales tax -- and sell everything from soup to nuts?

The Fair Tax blows away The Flat Tax.

Why should Bill Gates pay 100,000 times the tax of the average person. Money you unfairly take from him and give the government is wasted by our government and doesn't allow him to reinvest it to create more jobs.

Plus you still have an IRS that can penalize you.

The Fair Tax is the way to go. Read The Fair Tax by Neal Boortz and Congressman John Linder.

The link to that is here.

One thing flat taxes don't do is capture illegal transactions. The Fair Tax does.

Jim P., you are required to collect taxes based on the shipping address. Your customer must declare it on the "long" 1040 form if not.