To: phil_will1
What do you mean by regressive?
31 posted on
02/11/2004 1:14:18 PM PST by
Luke Skyfreeper
(Michael <a href="http://www.michaelmoore.com/index_real.php">miserable failure</a>Moore)
To: Luke Skyfreeper
"What do you mean by regressive?"
A regressive tax is one in which those who are at the lower end of the scale pay higher rates than those at the high end of the scale. A perfect example is our social security tax, which is flat until you get to the maximum and then decreases as a percentage as your income level increases.
Contrast that to a progressive tax, which is what our income tax is supposed to be. The problem, however, is that all the "loopholes" and special preferences greatly distort its progressivity.
For example, here in Atlanta, the Ted Turner/Jane Fonda divorce was heavily covered in the media several years ago when it happened. One of the articles revealed that court documents indicated that Mr. Turner had taxable income of something like $125 MM for the previous year and he paid around $5 MM in taxes. That's an overall effective rate of less than 5%. How many people reading this post make far less than $125 MM and would love a tax rate of 5%?
As Ancient Geezer pointed out above, the FairTax is truly progressive, not regressive.
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