Actually what Craigers is advocating is supply side economics which are nearly a perpendicular to Kenysian economics. Albeit there are some issues with a lasseiz-faire style of taxation, but from a social justice perspective, is it an appropriate function of the state to take the fruit of one mans labor and distribute it out to any other citizen?

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There is this general fact that the wealthy operate through different vechiles than the poor.
Basically they get there income, pay expenses then get taxed on the balance.
Employees get taxed on the Gross then can spent the balance on expenses.
So for example;

John A & John B
John A having 100,000 income, 80,000 expenses opeating through a business
John B having 50,000 income 40,000 expenses being an employee
Income tax being 50% after first 10,000

So for John A its 100,000 - 80,000 = 20,000
- 10,000
10,000 @ 50% = 5,000 Tax

John B its 50,000 - 10,000 = 40,000 @ 50% = 20,000 Tax

(Note: This is just a basic example ignoring all other taxes)

So even though John A earns more money he pays less tax, this has to do with the different wealth generation vechile used.

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"Better to die on you feet than live on your knees" - Emilio Zapata

That's the problem. Just "having the ability to pay" shouldn't be reason enough to rape them of their money.

You're still buying gasoline, right? Well why should they even bother to lower the prices? You have the ability to pay for it.

And this is why it seems like punishment for the successful people. Where is the motivation to earn more, if Mother Government is just going to steal it back, out of your pocket?

And that's why the FlatTax sucks.

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"It's the rich people's fault they earn more." - Makedde

So John A is incorporated? John A had $80k in losses? You know that private income and your own companies must remain seperate to exists as even a private corporate entity, moreover you neglect to mention the pay roll taxes he has to pay on the company he owns. Your scenario over simplifies the actualy tax environment. Which you did say so I'm sorry if I was over critical.

When you fill out tax forms, not matter which one, the total taxable amount stems from adjusted gross income, regardless of tax bracket.

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I have seen no credible evidence that the marginal rates charged to even the wealthiest taxpayers are high enough to deter them from earning additional money. So that's a strawman.

The 25% rate for middle-class taxpayers doesn't deter middle-class people from going to work. The 35% top marginal rate doesn't deter the wealthy from going to work, either.

Never mind that the higher your income, the less of it that is subject to that top marginal rate, as more of your pay comes in the form of capital gains and the like.

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Man up.

Captial gains you say? BO wants to raise those as well, but it's not just the wealthy that draw income from capital gains, it's every single American that has money invested in a 401k or an IRA.

The root of the problem is the tax code itself. It's cumbersome and almost impossible to interpret by anyone but an expert in the field. IMHO it should be scrapped and replaced with a tax on consumption rather than production, specifically the Fair Tax. The tax would remain progressive but would distribute the tax in a more equitable manor.

Progressive taxes, tax productivity. When teaching a child how to behave you should punish poor decisioins and reward good ones. When a person has made the good decisions to land themselves into the label of 'wealthy' we should punish this by taking a larger percentage of their income. People don't work their asses off to pay for some one else, nor should they be expected to.

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Especially considering that the 35% only counts for income above a certain bracket... The person still makes more money... especially considering that most people this is applicable to are not getting paid hourly.
The 70% tax rate was excessive, but there is no talk of bringing it back... and likely will not be for at least a very long time.

I'd say it would be a bigger deterrent from work if you were a poor person paying a flat tax to the point where working does not provide a living income.

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"Man lives in the sunlit world of that which he believes to be reality. But unseen by most is an underworld, a place that is just as real... but not as brightly lit... A DARK SIDE!"
-opening from Tales From the Darkside

Flat taxes seemed like a good idea at first, but there certainly are people who aren't capable of paying 15-17% of their income and that's understandable. What I do not agree with is taking money from someone in a higher tax bracket and then giving it to someone in a lower tax bracket. Taxing based on consumption minus basic neccessities levels the playing field while still remaining appropriately progressive.

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Where the gains are protected from tax, and when withdrawn are taxed as ordinary income (unless it's a Roth, in which case the gains aren't taxed at all). Kind of irrelevant.

I agree that the tax code is way too complicated and also too easy to circumvent, because it requires the IRS to ascertain how much money you're making. The biggest argument in favor of the FairTax, IMO, is the relative simplicity of it, the lack of loopholes and the difficulty involved in trying to cheat it.

That said, computers go a long way toward evening the odds. I do my own taxes with TurboTax; it's not difficult, just answering questions.

And the biggest problem with the FairTax is that it would shift the tax burden from the poor and wealthy on to the middle class. I prefer mildly progressive tax systems.

Hardly. They just follow a simple principle: everyone's second $100 should be taxed at a higher rate than their first, because it's farther away from the line needed for bare survival. It's the best way to maximize tax revenue from a given pool of money while minimizing the pain to the taxpayers.

It's defensible philosophically, too, because the wealthy benefit the most from the infrastructure, legal framework and stable society that their tax money buys. There's nothing wrong with having those who benefit the most, pay the most.

You take a larger percentage of their *additional* income. That's an important point. Everyone's first $30,000 is taxed the same. Everyone's second $30,000 is taxed the same. Nobody has previously earned wealth confiscated because they had the bad judgment to earn more money. It's just that as their income climbs, each additional dollar is taxed at a slightly higher rate. Which makes sense for the reasons cited above.

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Man up.

You did notice put a note stating this was a basic example. Buddy if you want detailed tax advise you can pay me for it, otherwise your getting basics.

But basically even with all the other taxes incurred an incorporated business if they have a good tax advisor should easily pay less tax than an ordinary person. Thats why wealthy people operate through businesses and investments while the poor operate through employment.
Personal and Business expenses can regularily overlap. Hence all those boondoogles company's have.

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"Better to die on you feet than live on your knees" - Emilio Zapata