'Progressive Taxation? I think mine is more about progress..

 As an advocate of the Flat Tax (but an advocate that realizes accountants, the IRS, and lawyers have too much to lose to ever let it happen), I wrote this in response to someone who advocated steeply progressive taxation.  They believe the rich need to pay a lot more.  I don't think that progressive taxation is just unfair to the wealthy, but to everyone.  Here was my response:

"You don't see it at work in the real world... Union guys turning down work they want because they'll lose most of it in taxes if they get bumped... Under the table jobs for a lot of blue collar workers so they won't get bumped up - it isn't just the taxes on the other job, its the affect on the main one.  I know of a contractor who makes $35/hr and his boss charges $50/hr. for him.    The contractor works as much as possible outside the loop now - he makes no more, the homeowner saves a little, the boss loses money, the gov. loses money in taxes and fees...  Why?  Why would the contractor do that when he makes no more?   Because if he does it through his boss he'll get bumped to a new bracket and lose out.  THAT is the real world. "

" Rather than say every citizen should pay the same (as we all have the same army, same roads, etc.) if you want to say that someone makes 100 times what you do then they should pay 100 times what you do then I agree.  But 'Progressive' Taxation is un-American.  That said, I could still get behind it IF it were on an extreme income...  ie, EVERYONE under $35,000 pays nothing (as they are just getting started or need every penny they earn to live).  At $35,000 to $55,000 the population would pay 5% (to ease into paying taxes.   From $55,000 to $350,000 we would all pay 10%.  From $350,000 to $1,000,000 we would pay 20%.  Over $1,000,000 a year you pay $35%. "

"Would it make people earning $950,000 stop and think about a yarly salary increase?  Sure would. But how many are getting that?  And those that get more than $1,000,000 per year in compensation usually make substantially more or it is based on performance (through bonuses).  Would some not take the 'raise'?  Maybe, but the money would then be reinvested somewhere rather than taken in compensation.  The gov. wouldn't get it in taxes but it would still help the economy.  Meanwhile, everyone from $35,000 on up would be encouraged to work more, work harder, try to get ahead, etc.  The increments would be small enough that the raise or additional work would not be chewed away, and those we need to encourage to work harder and take risks would be the benefit of their risks and hard work, not see it get taken in taxes."

I'm sure there are holes in the plan and I still think a straight 10% (or whatever) Flat Tax would be better as it addresses corporate taxes as well, but it is far better than what we have now.