Switching because of simpler implementation and lower cost of admin? Best time to implement because of low point in economy so future will be increasingly higher tax revenue?
If only we could make federal income tax this way. If we exempted income below the poverty line, then a flat 15-17% rate would generate at least as much tax revenue as today’s insanely complex systems. It’d mean eliminating all deductions and credits.
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The complex system is supposed to be progressive but billionaires are able to do tax avoidance. Complex system has good intentions but fail to achieve its intended goals.
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“When you create that really low flat tax, you’re tying the hands of your revenue system,” he said, explaining it may be hard to recoup lost income during an economic downturn."
Good. It SHOULD be hard to raise taxes. A last resort.
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However, in USA, can print USD.
Simplying the tax code is independent of whether tax is flat or progressive.
Remove all deductions. All income (W-2, 1099, etc…) treated equal.
Tax rate = f(x) where x = total income. Can still make any continuous function you want.
That’s going just swimmingly isn’t it?