Yahoo Answers is shutting down on May 4th, 2021 (Eastern Time) and beginning April 20th, 2021 (Eastern Time) the Yahoo Answers website will be in read-only mode. There will be no changes to other Yahoo properties or services, or your Yahoo account. You can find more information about the Yahoo Answers shutdown and how to download your data on this help page.

Hypothetically, which is the most fair form of taxation?

Consider the following:

We have a gov't where every individual is given the exact same rights & privileges.

Everyone has equal access to the things the gov't supports, including protection by the military/ police, roads, bridges, sewage systems, public libraries & schools. No one is prevented from using their share.

Now, a taxation system has to be created to pay for the above. In order to support the programs and infrastructure, the gov't needs an average of $1k in taxes per adult citizen.

The following ideas are presented:

A. Every single adult citizen is taxed the exact same amount: $1k.

B. Taxes are assessed depending on income or possession of property, so that bottom third pays nothing, the middle third pays $1k, and the top third pays $2k.

C. There is a new sales tax imposed on items not necessary for survival, including new clothing, electronics, furniture, jewelry, etc. The tax pulls in an average of $1k per adult citizen.

Which is most fair? Why?

20 Answers

Relevance
  • 1 decade ago
    Favorite Answer

    How about a variation on item C? A national sales tax where money is only taxed when it is spent. It would promote saving money and if the person passes away and gives it to his or her kids it would do away with the inheritance tax.

    If not a national sales tax then I would like to see a flat tax. I think it is stupid to charge one person 10 percent but someone else that makes more 30 percent.

  • 1 decade ago

    C. Because we do not receive the same exact privileges. I use roads more than the average person because I travel more, therefore the more I spend, the more I could be taxed, and that makes sense.

    I do not mind paying more because I earn more, however, I do not like huge amounts of my money being taken and given to lazy and drug addicted people.

    Burnt...I earned my money by spending 8 years with no phone, cable, etc. By minimizing my driving to less than 1000 miles PER YEAR and riding my bicycle anywhere I possibly could. By not going out to eat except for once a month at most, and never at an expensive place. So, why should I pay so much more if my sacrifice and hard work is what earned my $$? Again, I pay a lot more than the average person, and am okay with that except for government waste, and handouts to unworthy people.

  • 1 decade ago

    I would propose an option you don't have. DRASTICALLY reduce the size of the federal government to only the powers provided to it by the Constitution. At this point, all individual income taxes would be eliminated and no consumption tax would be necessary as revenues from tarriffs and excise taxes could pay for essential federal services. States would be allowed to tax citizens with whatever method and rate they (and by "they" I mean the citizens of that state) choose and, as a result, could mandate whatever additional welfare/entitlement programs they choose to support.

  • 1 decade ago

    A flat rate tax on all Americans.

    School tuition, pre-k to college 100% tax deductible

    $8,000 deduction per dependant(including self)

    All medical expenses 100% tax deductible (including gym memberships)

    Cost/Loan expense associated with converting to non-oil based forms of energy 100% tax deductible

    Car loan interest 100% tax deductible for non-gasoline based vehicles

    Mortgage interest to remain 100% tax deductible

    Purchase of US Savings bonds 100% taxde ductible for American citizens

    Retirement account contributions raised to $10,000 a year per individual

    Charitable contributions 100% tax deductible

    Charitable contributions of time 100% tax deductible(monetary value calculated using the minimum wage)

    Items that are identified as 'NOT ESSENTIAL TO SUSTAIN LIFE' should be taxed like:

    alcohol, cigarettes, cigars, jewelry, luxury items

  • How do you think about the answers? You can sign in to vote the answer.
  • Phil M
    Lv 7
    1 decade ago

    C) sales tax

    You only get taxed on what you spend, rather than what you earn.

    If I have 6 kids, then my income and necessary expenditures aren't taxed...I can actually buy something that benefits the market, rather than pay taxes to bureaucratic institutions.

    If I am taxed a flat 5% of my $100,000 income, well that $100,000 in NYC is a whole lot less than $100,000 in OKC....how would that be "fair?"

    A sales/consumption tax is the fairest form of all, it also allows for "silent protest" through starving the govt.....thats why they wont do this.

  • 1 decade ago

    B. Taxation should be based on ability to pay. This is and always will be one of the guiding principles of taxation. Option A is a highly regressive tax, even worse than a flat tax (because at least with a flat tax people pay a constant percentage of income - with this "head tax" as it is known rich people pay a lower share of taxes).

    This is not a statement about economics but a statement about what one perceives as fair - I think it is fair that rich people be allowed to have more money (I'm not for everyone being exactly equal) but they should also pay a higher share of taxes. There is no other basis for this claim other than that I "feel" this way.

  • Anonymous
    1 decade ago

    None of the above. The government needs to shrink and eliminate all unneccsary services. Things concerning public safety are acceptable, but all of the social programs need to go.

    And yes, a flat tax is fair.

  • Anonymous
    1 decade ago

    i agree with the one above me. flat percentage is fair. because some people will pay more than others but its exactly the same percent of income so its all the same share. I guess for the really poor people they could adjust it a bit. but for the most part they should have a flat rate.

  • Anonymous
    1 decade ago

    I think it would be (A) which is called a flat tax because everyone is taxed the same rate and people aren't taxed higher rates due to higher wages,but end up paying more than the middle class and the poor. Its all proportional.

  • Sam C
    Lv 5
    1 decade ago

    No tax at all is fair for me but fat chance we'll EVER see that so I screw the government any way I can when it comes to taxes but still stay within legal limits.

Still have questions? Get your answers by asking now.