Maximum taxation - good or bad?

[Mathematician]

The main problem I see with a "tax the rich" mentality is that it can only really be accomplished through tax brackets. The problem with tax brackets is that they tend to screw the people who just earn enough to warrant higher tax.

In England we have VAT (Value added tax) which I think could be a good idea if it was properly implemented. Theoretically luxury items warrant a tax and so the more luxuries you buy the more tax you pay. The problem with this is partly that it depends on consumerism which isn't great during recession and secondly what is considered "luxury" seems to be totally arbitrary. Sanitary towels have VAT for crying out loud.

Now I'll admit I'm not the most knowledgeable person when it comes to tax and economics, but I honestly don't think it's possible to have taxes that are completely fair on everybody.

Income brackets don't screw with anyone who makes more money. You don't jump from 30% to 32%; money at different steps qualifies at different tax rates.

Income tax is probably one of the most fair practices out there, if it weren't for all these "exceptions" we tie into the program. They should be all eliminated.

 

[Erebus]

Income brackets don't screw with anyone who makes more money. You don't jump from 30% to 32%; money at different steps qualifies at different tax rates.

Income tax is probably one of the most fair practices out there, if it weren't for all these "exceptions" we tie into the program. They should be all eliminated.

I don't know about the US, but here in the UK the difference between brackets is quite dramatic. For example, there is a 20% increase in income tax after £35,000. The next bracket applies after £150,000 so effectively somebody on £36,000 annual income receives 20% higher tax rate than somebody earning £34,000 but is taxed the same as somebody earning £150,000.

 

[blackout]

It makes no sense to have huge drop off/increase points.

You make one extra dollar
and suddenly you've lost thousands.
eh.

 

[The Sum of Awe]

I prefer to be tax free

 

[Revoltingest]

It makes no sense to have huge drop off/increase points.
You make one extra dollar
and suddenly you've lost thousands.
eh.

Generally, tax rate increases only apply to the money over & above the next lower bracket.
So the marginal dollar is taxed at the higher rate, but not the earlier dollars.

 

[blackout]

Generally, tax rate increases only apply to the money over & above the next lower bracket.
So the marginal dollar is taxed at the higher rate, but not the earlier dollars.

Ah. I see. That makes more sense then.

(It's not like I'd know first hand or anything...)

 

[Revoltingest]

Ah. I see. That makes more sense then.
(It's not like I'd know first hand or anything...)

May you suffer high tax rates....because of wild success, of course.