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Originally Posted by Jim Bon Jovi
the problem with a flat tax is that say you use a flat tax of 25% just for ease.
someone earning £10,000 is left with £7,500 to live on whereas someone with £1,000,000 is left with £750,000
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What makes a flat tax system special is that there's very few exceptions. But there are exceptions. Additionally, a flat tax is usually around the same level (if not lower, see Lithuania) as what would have been the lowest tax level in a progressive system. There's no change for the very poor, really. And one more reason, flat tax increases state revenue which can again be reinvested to help the people who live on peanuts.
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from a personal moral point of view i think someone earning £10,000 being left with something like £9,000 whereas someone with £1,000,000 being left with £500,000 isn't THAT bad a situation to be imposed for either person.
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i am not going to comment on this. If that's your moral perspective, than very well. If think it's extremely unfair.
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the 1st system is biased against the poor
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Why??? The rich pay in absolute terms more than the poor as you have pointed out in your very own example. It's not biased at all. It's the only NEUTRAL tax.
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the 2nd is biased against the rich. this isn't an anti-rich sentiment but by the by they need alot less help financially speaking than the poor so it should be them who takes the brunt of it.
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It is not biased against the rich per se. It is biased against the hard-working, the over-achievers, the people who make the word go around. Taking half their money reduces incentives, reduces productivity, lessens the number of start-ups, has tremendously negative effects on innovation...and and and. Progressive tax is playing Robin Hood. It may be noble, but it's theft in the end. A flat tax is fair, and leaving out the morals, what you don't see is that IT WORKS. The aim of taxation is to increase state revenue. A flat tax will do and ethical dilemmas are just tools to win elections.