What methods of taxing and what taxing policies are fairer on taxpayers? This question remains one of the most important in the study of the fiscal and political processes in the United States. Taxation is a matter of economic and fiscal decision making, as it is through taxes that the government renews its financial resources and creates revenues needed to support its expenses and costs. However, taxation is also a matter of political decision making, because the nature and type of the taxation policy adopted directly depends upon the political orientation of the ruling party. This is what Patterson means when he says that tax policies have numerous partisan dimensions (414).
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Democratic and republican candidates hold opposite opinions about the best tax policy. Democrats promote taxation policies that favor wealth creation by the working and lower-middle classes (Patterson 414). For these reasons, democrats vote for the use of progressive taxation systems, when the tax rates increase with income (Patterson 414). By contrast, republicans are more prone to keep taxes lower for the rich, thus fostering economic growth and encouraging higher levels of saving and investments (Patterson 414). These progressive and anti-progressive tax opinions become even more pronounced during election campaigns, thus making it even more difficult to choose what is fairer for citizens.
The current system of taxation in the U.S. is based on the principle of taking money from one citizen and giving it to another (Heubusch). Heubusch is convinced that it is high time for policymakers to give up their partisan commitments and establish a taxation system that would be fair to everyone. A flat tax whose rate is single for all levels of incomes is claimed to have the potential to reduce the existing income gaps and silence the debates surrounding the issue of taxes. The proposition sounds extremely feasible, given that, in 2009, as many as 1,470 millionaires in the U.S. did not pay any federal income tax (Coombes). Most probably, the flat tax proposed by President Reagan in the 1980s is the best way to achieve and sustain fairness across all population layers in the U.S.
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