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a single person earning $24,000 a year, at a flat 10%, would pay $2,400 in federal income tax. however, that same person, with the current standard deduction of $8,900, would have a taxable income of $15,100 and pay $1,510 in income tax.
under our current system, that same person earning $24,000, claiming the standard deduction, and filing as "single", now pays $1,868 in income taxes.
with the 10% flat tax, keeping the standard deduction, that person would pay less federal income tax.
10%, with no deductions, would hurt low-income people severely!
a single person earning $100,000, at a flat 10%, would pay $10,000 in federal income tax. with the current standard deduction, that person would have a taxable income of $91,100 and pay $9,110 in federal income tax.
under the current system, the 100k earner, with the standard deduction would pay $19,493 in federal income tax. so, all other things being equal, that person would be better off by far paying the flat tax.
of course, all things are not equal. the problem with our current system is that there are too many deductions! therefore the wealthy are able to "shelter" their income. that is why the richest people generally pay the least percentage-wise in taxes.
we should keep the current system, with modifications. the percentage of income tax paid should increase as income increases. what we need to do is get rid of all the "shelters".
the standard deduction needs to be raised so that people with poverty level incomes are not taxed at all, or at least very little, and there should be "excessive wealth" taxes imposed on people whose income places them above the "middle class" income level.
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