Assess a Proportional Income Tax Some politicians believe that high marginal tax rates

Chapter 14, Problem 34

(choose chapter or problem)

Assess a Proportional Income Tax Some politicians believe that high marginal tax rates discourage people from working. They have suggested that it would be better to charge all taxpayers the same percent of their income so that the lower marginal tax rates for many people would encourage them to work and earn more. It has been estimated that the same amount of tax revenue could be collected if all taxpayers paid roughly 23 percent of what they earn in tax. This would mean that a person who earns $10,000 per year would pay $2,300 in tax while a person who earns $100,000 would pay $23,000. Decide whether you believe this is a good or a bad idea. Then write several paragraphs that identify and explain reasons for your point of view. Be careful to discuss the impact of such a tax structure on the economy as well as your opinion of its fairness.