AZ 'Fair' Tax Bill, HB2636 -- A Case Against It

[AZKing]

I'm curious to know what other RPF members think of the Arizona flat income tax bill, HB2636.

The flat tax bill eliminates all write offs and eliminates the progressive tax, ranging from 2.59 percent to 4.54 percent, with a 2.13% flat tax. The bill has passed in the Senate.

Generally speaking, I would support a flat tax as it allows everyone to pay for the services that we all use. However, part of the platform of many of the members of the Arizona legislature is not raising taxes on anyone in order to give maximum economic liberty. HB2636 would raise tax raise taxes on eighty-eight percent of the population, while the top 12 percent will see drastic cuts.

A tax increase, even in the name of a "fair" flat tax, is still a tax increase. It is hypocritical to promote economic liberty and freedom and in the same token support a bill that increases taxes on a large majority of the population.

I believe the truly fair approach to the issue is to just eliminate the income tax altogether. It is really an unfair system of taxation. Not even a 'fair' income tax is truly fair to someone who works and is forced to give their fruits of labor directly to the government. A flat, consumption tax is a much more fair system of taxation (and even that is already higher here than many states).

[AZKing]

http://img805.imageshack.us/img805/2360/azflattax.png

The state is already using an 8.85% sales tax and many people have had their property taxes increased in the years since the state budget has been cut. Along with other fees, most people are already paying more than 10% of their earnings to the state.

[Adrock]

Here is another chart from our local Tucson Paper that helps explain a little more:

http://bloximages.chicago2.vip.townnews.com/azstarnet.com/content/tncms/assets/editorial/f/ba/76e/fba76e18-5698-11e0-86aa-001cc4c002e0-revisions/4d8c1b059ed15.pdf.pdf

[Adrock]

I have to agree that the elimination of income taxes all together is the right way to go.
The flat consumption tax would be second best.
The Progressive Income Tax structure is God Awful.
The Flat Tax Pros:

Everyone will have some skin in the game. Hopefully this will allow the entire public to start paying more attention to how much money is taken in taxes. There won't be half the population paying the vast majority of taxes, of which the other half consumes much of in services. It is easy to vote for politicians that will raise your neighbor's taxes to give you something for free.

This is an income tax not old money just sitting around. Many of the individuals in that higher income bracket will be your small business owners that will hopefully be able to reinvest that money back into their businesses. More jobs, creates more taxes, better economy and so on. I am not sure if or how the corporate taxes are effected with all this but I hope they are lowered too.

I like the idea of there being no write offs. The wealthy are able to afford the better tax lawyers so they end up not paying too much because of the loop holes in the laws concerning write offs. The poor obviously don't have too much income, so they don't pay much in taxes. It is really the middle class that gets the boot most of the time.

Who ever is saying that it isn't a tax increase on anyone is flat wrong. I believe they are going to be taking in the same amount of tax revenue with this system, it is just going to be spread out more evenly. I think that this may not be ideal but it is a step in the right direction.