The Flat Tax

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Trent0405
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On a conceptual level a flat tax has always seemed rather inefficient. However, it seems like most studies show a positive impact. This one shows how a flat tax increases revenue by 25%, increases productivity by 5%, and decreases tax evasion by 10.5%.

What do you guys think?
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The adoption of a flat rate income tax generally is not expected to lead to significant increases in the tax revenues because labor supplies are believed to be fairly inelastic. However, if the economy is plagued by ubiquitous tax evasion, as was the case in Russia, then flat rate income tax reform can lead to substantial revenue gains via increases in voluntary compliance.
It's obviously not applicable in general. But it can work if your country is full of tax evaders I guess?
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Abolish the income tax and replace it with a sales tax and a capitol gains tax.
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Why?
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essentially the flat tax would be a use tax on purchases and services.  "luxury" items would be taxed higher.  some states tax prepared food, like at restaurants higher than their regular sales tax.  I like the idea of you get taxed on what you use/buy.  This helps get rid of the tax shelters and b.s. like keeping money in the Cayman islands.  I think it's called "the fair" tax but I can't remember for certain.
the capital gains tax could then be set to zero since capital gains would be used to purchase stuff, which would be taxed.  zero capital gains encourages investing which is a good thing.  taking investment losses reduces your capital gain tax currently, so it's a game, game of avoiding taxes.  The rich people pay professional players to avoid taxes, it's always been that way and will always be if changes aren't made.  But since the rich are in control it's not likely it will ever change.

10 days later

TheUnderdog
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I see a liberal and conservative argument to abolish the income tax.

The conservative argument for it is it discourages income production.

The liberal argument for it is the rich people (whom the income tax is designed to tax) will try and succeed in finding ways to dodge it no matter how many loopholes you try to close.


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"they'll find loopholes so let's just abolish the whole thing and let them pay none without any loopholes"

riiight
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Flat tax obviously supports economic growth because it helps the rich prey on the poor easier. Economic rapid growth is a sign of a country that overvalues that and undervalues how well it treats its poor, don't you get that? Left-wing policies are not about what helps the economy grow fastest, they're about what helps the people live the best lives.
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seems like it depends on the country.

A common trend I've noticed from the abstracts of the studies/analyses I've read  is that a flat tax generally helps poorer nations more than wealthier ones, perhaps that's why the studies differ. I am unsure if it really harms the poor though.

In recent digging it also appears that a flat tax has harmed the Netherlands economically. Can't find the link again though.

In short, it seems like a flat tax can be improve productivity, economic equality,  and revenue, however, it seems like it can depress these metrics of success as well in certain circumstances. 

I say it's inconclusive.
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The flat tax was held against zero tax in the situations where it helped.
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No, it was compared to the existing Serbian income tax system.
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Wtf you use Serbia??? Russia was pseudo-left until it again became brutally capitalist.
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I gave two pro flat tax sources, one from Serbia, one from Russia. I thought you were talking about the Serbian one.

Russia has always been pseudo-left until it again became brutally capitalist.
Not really that capitalistic.  It's 85th and 94th  on the 2 prominent economic freedom indexes. Also, it does rather poorly on competitiveness indexes so it certainly values fairness more than brutality when compared to the developed world.

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Economic freedom index isn't the same as capitalism. It's capistalist and corrupt. Capitalism is evil in its true form.
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Don't trust data from Russia and Serbia, they don't always let true stats get out.
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The rich would get taxed by alternative means, like the capitol gains tax.
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Least amount of rich at one end <

Most amount of middle peopl in middle girth |

Least amount of poor people at the diametric opposite end >

This is defined by and octahedron <|>

Tax is irrelevant  to humanities survival and prospering on Earth.

Only spiritual empathy can save humanities ass from extinction.

Eco-onomy = Ecology based systemic processing of work efforts { ethics } and the resultant goods { product output }.

Back to basics, clean air, clean water, food, shelter and protected sex for a reasonable population that fits the ecological systems that are in place.

98 days later

Sum1hugme
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I can't support a flat tax, because it disproportionately taxes the poor
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Historically speaking all taxes disproportionately effect the poor.
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Tax brackets don't nearly as bad, since it adjusts for your income. Flat tax cannot adjust for an individual's income. 
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Bracket tax is avoidable by the wealthy through the use of corporations and international assets in regions with lax or even non existent tax regulations. Bracket tax disproportionately effects the poor. In order to remain consistent in your views you must not support a bracket tax either.
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That's the government's failing in allowing loopholes. I've personally known wealthy people who pay exuberant amounts of money. They don't avoid that. Granted that's in the U.S. but in contrast, the poor people I know pay almost nothing. Because they're in a bracket below the poverty line. A flat tax indiscriminately taxes the people who can afford the tax increase the least
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Please clearly define exuberant and almost nothing in this context (hopefully taking into account the fact that if you have one million dollars and lose ten percent you have lost far less economic freedom than if you started with one hundred dollars and list ten percent).
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Well I'll list a specific example. I have a relative who made $400,000 one year. He had to pay $200,000 of it in taxes. This seems an exuberant sum. A different relative of mine made about $20,000 one year and had to pay only a couple thousand in taxes, much of which she received back. This seems more fair though, than a setup where the latter person is paying a higher percentage of their income in taxes than the former.
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I'm not sure if "fair" or the right term to apply to two individuals one of whom can afford to give up half of their yearly income and still have more than ten times the yearly income of the other.