why cant income tax be fairer ?

Question

ithink there should be a cut off to the amount of money you earn as to the tax you get taken. because it seems to me that no matter how much overtime i do to improve my finances i never seem to be any better of ,it seems so unfair,what do others think?

Answer 1

Why cant income tax be fairer ?

Perhaps taxing “income tax” can not be more fair. Is taxing income the answer?

Where is “written” that income must be taxed to fund our collective gov’t needs? It has been that way since 1913. Prior to that, various excise taxes were used.
Why must we tax income? Some how point number two of the “Ten points of communism” found in the Communist Manifesto has become the norm. (see below)
Why would we want to?
What are we taxing when we tax income?
We tax work.
We tax prosperity.
We tax upward mobility.
We tax success.
Many economists believe that if you tax something more, you get less of it.
Do we really want less work, less prosperity, less upward mobility, less productivity and less success?

I offer a different tax plan. Well, no, I did not think of it. Greater minds than mine came up with it.

What if????
We remove all taxes from the production / income side of the equation and place them on the consumption side?

This is hard because we lived with taxing income for so long.
Think of it though. All of the time and money we spend just to comply with the tax code and the money we pay the IRS just to collect the taxes would be saved.
That alone makes it worthwhile.

But what if?
Those starting out in the working world can get ahead faster? What if they could get over the hump of sustaining into saving quicker?
It could happen with the FairTax Act.
What is it?
The FairTax Plan is a comprehensive proposal that replaces all federal income and payroll taxes with an integrated approach including a progressive national retail sales tax, a rebate to ensure no American pays federal taxes on spending up to the poverty level, dollar-for-dollar federal revenue replacement, and, through companion legislation, repeal of the 16th Amendment. This nonpartisan legislation (HR 25/S 25) abolishes all federal personal, gift, estate, capital gains, alternative minimum, Social Security, Medicare, self-employment, and corporate taxes and replaces them with one simple, visible, federal retail sales tax – collected by existing state sales tax authorities. The FairTax taxes us only on what we choose to spend, not on what we earn. It does not raise any more or less revenue; it is designed to be revenue neutral. The FairTax is a fair, efficient, transparent, and intelligent solution to the frustration and inequity of our current tax system. ( see: www.fairtax.org) H.R. 25 / S.R. 1025



TEN POINTS OF COMMUNISM (FROM THE COMMUNIST MANEFESTO)
2. A heavy progressive or graduated income tax
http://www.marxists.org/archive/marx/works/1848/communist-manifesto/ch02.htm

Economists Back 'Fair Tax' Proposal http://www.heartland.org/Article.cfm?artId=17042

Written By: Merrill Bender
Published In: Budget & Tax News
Publication Date: June 1, 2005
Publisher: The Heartland Institute
________________________________________
Scores of economists across the country have come out in support of the “Fair Tax” concept, giving a boost to supporters who are working to have at least 100 Congressmen and Senators signed on as sponsors of Fair Tax bills during the current 109th Congress.

Answer 2

Are you really suggesting that the CEO making $3,000,000 a year should have his taxes lowered? I doubt it, and I doubt that very many people would consider that fair.

As to your overtime, if you work more, you'd definitely get more after taxes. The most you could lose in federal income tax is 35%, and I doubt if you're in that bracket - the CEO
mentioned above would be, but he or she isn't going to get paid for overtime - I assume you're not in the 35% bracket.

You'd also pay 7.65% for social security and medicare, and maybe a state and/or local income tax, but you would still have a lot of the overtime pay left over.

Answer 3

The fact is the world is not fair, so does the tax system.
The tax system is designed to help the rich and the poor, but hurt the middle class people.

The riches affect the government by all the donation to the politicians. The poor people always ask for benefit from the society. And the middle class people always contribute the most to the tax system but benefit the less from society.

That's life.

Answer 4

ive never worked out how working overtime could reduce your income. tax at 25 per cent stays the same whether you work 30 hours or 90 hours

Answer 5

The tax system in the UK absolutely stinks. I'm in a low-paid job. Wneh I first started the job, I applied for tax credits, and got about £30 per week. However, after three months, I had to let them see my payslips, and as I had to do overtime (its compulsory in my job), my tax credits were cut to £12 per week. In short, If I do overtime I am essentially working for nothing.

I have an occupational pension, which I have taken to boost my earnings to a reasonable level, but even that is taxed! I am being milked because I had the foresight, thirty-two years ago, to spend a proportion of my earnings to provide for myself in later life. I feel I would have been better off if I had spent the lot on booze and gone onto benefits when I was made redundant two years ago.

When I do my weekly shop, I see people in the supermarket, who are professional non-workers (and frequent users of the criminal justice system - I live in a small town and work in the Magistrate's court), loading their trolley with expensive packeted food and oodles of cheap alcohol. I keep myself and my partner on fresh food for an outlay of £30 per week, and we eat duck, steak and free-range chicken.

The national average wage is said to be £25000 pa. I get £13000 in wages and £4000 from my pension. Nobody, in later life, unless they have qualifications and experience in medicine or the law, is ever going to be able to approach the national average wage. Ageism may be outlawed, but I have yet to know of any of my colleagues from my old job, who are over 35 and have been made redundant, who have ever managed to achieve the earnings they had in their previous employment. We end up as security guards or stacking shelves at the supermarket. Dagnabbit, I'm a qualified chef, and the best I could get around here (N Essex) as a head chef was £7 per hour.

Overtime should not be taxed. If you choose to give up your free time to work, then that money should be yours in toto. Most of us have nothing to sell but our labour - we can't all be Alan Sugar or Richard Branson, but if you have the guts to work excess hours then that money should be yours, not given to a government to be given back to the army of ignorant, shiftless clods (our own people - not immigrants from E Europe or Muslims or other victims of misguided rants). One has only to watch Tricia Goddard to see the extent of the useless in our society, and I, for one, strongly resent subsidising them because I was prudent in my younger life.

Answer 6

Since the maximum rate is 35%, you'll ALWAYS get more money in your paycheck by working overtime.

Answer 7

It does cut off at 40%.