Sky_Blue_Dreamer
Well-Known Member
Flat rate vs progressive rate is an issue that was has always been up for debate for various reasons depending on how you look at it.
For example, an argument for flat tax was it makes tax easier, but others state that the rich can afford good accountants and end up paying a lower effective rate of tax (even with higher band tax rates there are still plenty of individuals and companies who arrange their tax affairs so they pay less actual tax, let alone effective rates of tax) than someone on minimum wage. Then the rich come back with "but by increasing the rate of tax people are more likely to try and avoid it" but evidence has shown in country's with flat tax that the rich (well, everyone really) will still avoid tax whenever possible.
Another argument is that those with large cash/capital reserves will benefit the most from society and things like infrastructure/education and thus should contribute more towards it, and they also have the best means to pay for it. This is especially true of those with inherited wealth, but personally I think that needs to be done via inheritance tax overhaul which I'm not going to go into here.
One of the biggest arguments historically for the higher rate of tax was that higher education etc was free, so therefore those who had benefited from it should contribute more. Now we're going more US style and have tuition fees that doesn't stand up very well.
