There is always debate regarding the structure of the current income tax system in the U.S. Many opponents of the current system argue that under its current structure, many wealthy households are able to avoid taxes and for most households, the tax system is simply too complicated and confusing. One solution that has been proposed is the "flat tax." What are the benefits and detriments of replacing the current income tax system with a flat tax system? Who benefits and who might be harmed? What implications does the flat tax system have for tax preparation companies such as H&R Block?
In 2008, Federal Reserve Bank Chairman, Ben Bernanke, and U.S. Treasury Secretary, Henry Paulson, responded to the financial crisis by intervening in financial markets in unprecedented ways. Do you think this intervention was necessary? What are the consequences of this intervention? What might have happened if they had not intervened?
Firstly, you'd probably like to know what the "flat tax" is compared to a proportional tax system. A flat tax is a single marginal tax rate for all income. Simply put, the flat tax system is simple. Because of this simplicity, wealthy individuals will have a difficult time finding methods by which to avoid paying high tax rates. To give you some idea of the extent of this problem, there was a great deal of outrage when Berkshire CEO Warren Buffett paid a lower marginal tax rate than his secretary. ...
The expert examines debates regarding structures of current income tax systems in the United States.