The flat tax stands in contrast to the current graduated income tax, sometimes called “progressive taxation.” The current Federal Income Tax is progressive, meaning that people are taxed at progressively higher rates, with rate of taxation increasing the higher the income. Some suggest that the answer to simplifying the Tax Code is to abolish the current code and replace it with a so-called “flat tax.” A flat tax is defined as a tax code with one universal tax rate that applies to all citizens, regardless of income, and which contains no exemptions or other deductions for special categories of taxation. Tax Code claim that the reason our tax laws are so convoluted and complex is because there are too many categories of taxation and exemptions. Can anything be done to lessen this complexity? The Flat TaxĬritics of the U.S. Tax Code is almost impossible for any one person to read, let alone understand and act upon. A common complaint about the American tax system is that it is too complex.
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