Flat Tax = Everyone pays an equal percentage. Does it work on paper/in theory? In practice? The idea behind it is simple: Simplicity.

The tax code has many categories that create complexity manifesting in what is called compliance costs. The time and administrative costs for businesses, individuals, and goverment/beaurocracy, to organize and execute such finetuned calculations adds up to dollars. Billions according to an analysis like this.

Right now we have seven tax brackets among three categories of people, that's 21 categories, and it gets even mroe complicated after that. 

Forget the articles, links, and news. I'm posting them for a context that we can all start from. I think everyday people don't often confront this kind of issue in the news, online, and certainly not in school. I'm trying to figure it out just like everyone else is. But I gotta say, it seems like the only people a flat tax hurts is the poor. In the youtube link the guy even says well make it 0% tax for family's below 50K and then the flat 17% for everyone else.

So, what gives?

17% tax is ridiculous. Plain ridiculous. I'd rather have a system that rewards entrepreneurship before mega fortune made on personal basis such as actors and athletes. A-list actors and soccer, basket and other players should pay more than someone who makes the same amount annually by having built and maintained a huge company which employs thousands, if not tens of thousands, the value to society is much, much bigger.

That's my opinion on the matter anyway.

But how many jobs are created from something like soccer being big? I know soccer stars might not directly create a lot of jobs but indirectly they do.

The problem is that lower incomes would have to pay more than they do now and the money they get is barely enough to live.

The flat tax is the only fair tax in existence and for that reason will NEVER happen in the west. Just forget about it .

Flat taxes are a dumb and terrible idea for a plethora of reasons.

The most straight forward of these reasons are that people who make less tend to have less disposable income. So if there's a 10% flat tax, the person making 50K needs his 5K more than the person making 500K needs his 50K.

The reason behind this is simple. The things a lot of us buy cost roughly the same no matter how much we make. A PS4 is $299 for everybody, Gas, food, cellphones, clothing, and a whole host of other things don't change drastically for someone who makes more money.

The second most obvious reason why the flat tax is dumb is simply revenue. If you make a tax rate that is lower than what most high income people were paying before than the revenue stream is going to collapse. Currently, everyone who makes more than 38K is paying more than that. A bulk of personal tax revenue comes from higher income people because that's were the bulk of the money is. So to take that stream of revenue and decrease it so vastly is going to hurt.

Say you have two teams with lots of mega stars, Manchester City versus Real Madrid; even if I agree with you in principal, there's no way their performance is creating enough stimuliation on the job market to justify their salaries relative to societal value. Another thing that annoys me is that we tend to dote on athletes and actors and hate on entrepreneurs, for some strange reason.

Example above, quick maths; Manchester City's total wage expenses are around 2.680.000 £ weekly, that makes about 3.680.000 $, add bonuses that are quite common, and one can easily add another 5-10% on top. The yearly cost is s staggering 1.393.600.000 £, or roughly 1.910.000.000 $.

Real Madrid weekly wage expenses are around 2.173.000 £, that makes about 2.980.000 $, the same type of bonuses are just as common here, adding another 5-10% or more on top. Yearly cost is about 1.130.000.000 £, or roughly 1.780.000.000 $.

With bonues, let's say about 4.000.000.000 $ with bonuses, which is likely on the low side. Even when you factor in medical staff, training staff and facilities, maintenance on stadiums, transport, PR departments, ticket salesmen, waiting staff, cleaning staff and stadiums and all other related jobs, even the net sales of shirts and other effects and the ones working these stores (where shirts from all sorts of teams are sold), the outcome will always favor an entrepeneur, considering the relative low amount of working hours per person per team, they simply don't employ nearly enough people through their sport. Given, it's hard to put a price on entertainment, but it's still food for thought. The net gain from actors are even worse, someone like Tom Cruise, who could easily make 50-100 million $ on a big film that takes him about 1.5-2 years to take part in, in bouts separated by breaks and other projects, a similar generation of revenue across actual industry or similar positions to provide jobs would be massively advantageous over this.

Flat Tax is a great idea that has been tested in many countries. With high tax-free allowance poor people will not pay income tax at all.

Good response and I totally agree with you. 

Yes that could work. Tax free upto $50,000 and then 80% tax for all income above that or maybe tax free up to $5,000 and 20% tax above that. Whatever if you try to make the lives of the poorer better you will punish the better off more. You need tax for public services to function. 

The US for example has far too low tax to the point where it is building up a huge national debt because it is spending far more than it takes in. Same as many countries. 

Over $61,000 of debt per head in US and that doesn't include public liability debt for pensions etc I suspect. Expenditure needs to reduce and tax needs to go up considerably. So not really a time for a flat tax rate. If anything they need to squeeze every level of society to the maximum they can get away with that won't hurt the economy.

http://www.nationaldebtclocks.org/debtclock/unitedstates