Originally Posted by kjpliny
Flat tax? I say abolish the IRS and save some money!
Where I live, the lower income marginal rate is 25.5%, and the big earners pay 39%. So would the rich pay less, or would the poor pay more, or would it be a bit of both. I admit, a flat tax on wages is probably how things should be done, but no matter where you set the rate, you'd have a political firestorm on your hands.
As far as different investments receiving different tax treatments, I believe that those who are willing to risk their money by investing in those things that are currently taxed as capital gains generally boost the overall economy of the nation more than those who squirrel away money in savings accounts. I'm not sure how it would play out, but the act of taxing both at the same rate would definitely make for some interesting times on Wall Street.