The Seduction of a Flat Tax

GOP pundits and politicians have been throwing around the concept of a flat tax for quite a few years. They've suggested a one size fits all tax rate ranging from ten to eighteen percent, but what impact would this really have on taxpayers, especially if all deductions, credits, and personal exemptions were eliminated.

Those who would benefit the most from a 15% flat tax would be those earning wages of more than $379,150 a year. Almost all the rest of us would experience a tax increase with lower income earners seeing the most significant increases.

Why, you may ask? The reason is that very few of us pay the full amount of our actual tax rate. For example, someone who falls within the 25% tax bracket may actually pay only 10% in taxes after applying all the legal exemptions, credits, and deductions. Even those filing EZ tax forms benefit from standard deduction.

I'm not opposed to a flat tax, but I am opposed to the same flat tax applied to everyone. Bring on a more simplified tax code, but one size will not fit all.

Tax confusion

Politicians of both parties continue to posture and play the class warfare game. These opposing positions will only guarantee that nothing changes.

We need to create a more favorable environment for businesses, reduce government waste, simplify the tax code, secure Social Security and Medicare for seniors, and raise more tax revenues to begin paying down our national debt.

Compromises are need:
1. Reduce highest tax rate to 25% and eliminate loopholes,
2. Eliminate income tax on the first $25,000 of wages and first $25,000 of capital gains,
3. Change tax code to a graduated tax for both wages and capital gains ranging from 10% to 25%,
4. Eliminate loopholes and gradually reduce itemized deductions and exemptions,
5. Increase employee payroll tax (FICA) for Security Security and Medicare by 1/2 percent each year for the next eight years,
(public employees in Ohio pay 9.5% off the top for retirement)
6. Create a national sales tax (excluding food, medical, and housing) until national debt is reduced.

Major flaw in new Back to work plan

Businesses hire new employees because they have more work than they can handle with current staff. Getting a tax credit for hiring unemployed workers makes no sense. Employees cost a business money, both in the short term and long term. Employee benefits, including employer Social Security match, training, and health care insurance, can add 25 to 45 percent more to the cost of hiring a new employee.

This is so obvious that it boggles my mind.