This is a straightforward question of fiscal policy “ should people who earn more pay direct tax (tax on income) at a higher rate or not?

 

Definition: Progressive Tax

A tax that takes a larger percentage from the income of high-income people than it does from low-income people.

 

For example, if a person who earns a yearly income of $20,000 would be taxed at a rate of 10% ($2,000 taken) while a person who earns a yearly income of $120,000 would be taxed at a rate of 30% ($36,000 taken). This is in contrast to a flat tax of 15% which would take 15% of the person who earned $20,000 and the person who earned $120,000.

 

This can also apply to corporate taxes as well as on income from stocks/bonds/capital gains. (But we can get into that later!)

 

So what does TDN think?

 

Resources

http://en.wikipedia.org/wiki/Progressive_tax

http://www.investopedia.com/Default.aspx?viewed=1

Use Google “ Darn it!

I believe that there should be one rate for everyone. The way it is now, the wealthiest 1% of Americans pay 99% of all income tax.

Flat rate is better. Rich people already pay more with a flat rate, because it is based on percentages. Why charge them even more?

Well I can't say I disagree with either of you. I agree because the rich are *usually the ones that own businesses and invest their money, like Bill Gates. If he is paying both higher income taxes as well as corporate taxes, it puts a damper upon their spending and investing. Both of which puts their money back into the economy.