Question

The tax system is how the U.S. Government raises the revenue it needs to provide goods and services for its citizens. Do you think our tax system shares the burden of these goods and services fairly amongst all Americans? If you were in charge, what would be your policy position--or approach--to the U.S. tax system?

Answer 1

In my opinion U.S. tax system shares the burden of goods and services fairly for its citizens amongst all Americans. The governments at all levels throughout the United States impose taxes to finance spending programs that target to benefit U.S. citizens. The progressive taxes are based on the ability to pay principle, thus decrease disparities in the distribution of wealth and income. Moreover are equitable because rich people need to pay more taxes as they have higher ability to pay. Thus narrows down the differences between the poor and rich people of the country

I was in charge I would have continued with progressive taxes, however would impose certain strict regulations to ensure that specified in the tax law and the true economic burden remains the same. For example, U.S. Social Security payroll tax requires that employees and employers to split the tax, but the true economic incidence of the payroll tax are passed to employee. With strict rules it needs to be eliminated. Furthermore, although federal tax burden is progressive, which means that overall tax rates usually increase with income, however this is not the case for all types of federal taxes, thus needs a consideration and an action to alter the rule. For example, excise tax fall more heavily on lower-income households.