b. after the closing entries are posted, what is the ending balance in the retained earnings account? It certainly does shift the Phillips curve: the tradeoff between inflation and unemployment. Wages are easy to see and easy to tax. Learn how and when to remove these template messages, Learn how and when to remove this template message, European Union Common Consolidated Corporate Tax Base, Institute on Taxation and Economic Policy, https://en.wikipedia.org/w/index.php?title=Fixed_tax&oldid=756342534, Articles lacking sources from December 2008, Articles needing more viewpoints from December 2008, Articles needing expert attention with no reason or talk parameter, Articles needing expert attention from January 2015, Taxation articles needing expert attention, Articles with multiple maintenance issues, Creative Commons Attribution-ShareAlike License, This page was last edited on 23 December 2016, at 15:53. ALL people regardless of the character of the income (wage, cap gains, dividend, rents, etc) get to take home the same percentage of income earned (in the general sense not the tax accountant definition). It gets complicated, but not with a flat tax! In the aggregate, how do you know that it puts more dollars in the pockets of the poor (since it will reduce the employment of some)?
Before Personal Capital, I had to log into eight different systems to track 28 different accounts (brokerage, multiple banks, 401K, etc) to track my finances. Find the best study resources around, tagged to your specific courses. Don't subscribe The wealthy derive most of their income from non wages. Today, I finally came across a brief article that I believe presents a really good argument for the problems with a flat tax: Namely, I think the “diminishing utility of money” is what really convinced me. A tax rate of 14.5% on the rich is lower even than the effective tax rate that the richest people in the world pay now, which includes the exploitation of all of the loopholes in the tax code that Rand Paul is bragging about getting rid of. It’s only fair the wealthy pay more out of their millions and billions of dollars to subsidize the rest of us who need it the most. That would have a much bigger impact on quality of life for a family making $100k as opposed to a family making $200k.
The flat taxâs appeal is a millimeter deepâ âthe percentage is the same, therefore fairness exists!ââbut a momentâs contemplation of it will reveal that it is a terrible policy for the poor.
Equality! Update for 2019: After leaving Corporate America and making little money in 2012 and 2013 from a lot of money a decade before, and now back to making a decent chunk of change with my online media business and various consulting gigs, I’ve got to say that my feelings about a flat tax have not changed. What the government has is a serious spending problem. Because of this, fixed taxes are better suited to funding governments which are not responsible for providing very much for the citizens and therefore do not have much to pay for. 8% for Town/City. It would help them to increase exemptions and the standard deduction.