Republicans have gotten away with fooling the people on this topic for years. The flat tax argument for “reducing” taxes is the biggest scam on poor and middle class people ever devised.
Let’s start with the argument that a flat tax, say a 5% sales tax across the board in Ohio, is fair. Paying a flat tax on everything means that you’d have to add that tax to everything you purchase; tickets to your kids’ high school game, parking in a parking lot, buying Girl Scout cookies.
Not only that, you’d still be paying a gas tax. The only reduction in your taxes is an elimination of the income tax on everyone.
In Ohio, most people pay about $600 in income tax every year. Under a flat tax, you would have paid that much in just a month commuting back and forth to work and doing all the other things you do in a day.
But wealthy individuals would end up getting a tax break because they would not be responsible for paying any income tax. They would still have to pay the increase in sales tax but an increase of $40 per week for a millionaire is pennies in a bucket.
Take that same $40 per week out of the salary of most people making $10 - $15 per hour and it makes a huge difference. And those are the same people who have those other expenses that some wealthy people don’t have, like day care costs, emergency room visits, high interest fees on their cars and if they have them, their credit cards.
Those expenses eat up the pay checks of people living week by week on what they make. Wealthy people who own their homes and can afford to pay more, pay less. Those who cannot afford to pay any more are made to pay more than double what they do now. That’s not fair.
Take the argument that it reduces taxes. That is partly true, it does reduce taxes; for the top two percent of Americans. It does nothing for the vast majority of wage earners. It is a regressive tax that asks more of those who make less and less of those who make the most.
Meanwhile, the majority of people who already are struggling who find themselves sacrificing big things to come up with an extra $40 a week out of their paychecks, they are not going to go buy a car or a house. They are not even going to the movies or buying clothes. They are holding on to every single dime they make so that they can make ends meet.
When people are not spending in the economy, employers reduce their number of employees, they stop filling orders for their products, and eventually they have to close up.
With companies closing and people getting laid off, tax revenue coming into the city and state and federal coffers dries up. And remember, in this tax scheme, there are no property taxes, so the main revenue of the state and local government comes from the flat sales tax, while spending is stalled and stopping.
This is the kind of “small” government the Republicans should be well known for by now, you know, recessionary government. Let’s call it what it is, they don’t want smaller government, they want intrusive government. They don’t want lower taxes, they want regressive taxes.
Even if they really truly believe in their hearts that this kind of system can work, history, empirical evidence and common sense should tell the people that this dog don’t hunt. People may be some dumb, but they ain’t plumb dumb. Well, let’s hope not.