Friday, May 11, 2012

Pay or Not

I always want to discuss about Taxes, but Ingrid posted it already in her blog so I will just elaborate on that a little more.

Everyone pays taxes in one form or another- mostly income and sales taxes. But why do we pay these taxes? There are many services offered to citizens that could not be managed effectively under any other system.

I do agree with Ingrid that the federal government uses our tax dollars to support Social Security, health care, national defense and social services such as food stamps and housing. Services provided by taxes in South Carolina are public schools, safe highways, health care, prisons and social services for low-income citizens.The city or county where you live provides water and garbage service, police and fire protection and also contributes to public schools.

But.... why must they be paid for with taxes?  Why shouldn't we just pay individually for what we use? 

The answer is simple:  Because no one could afford it.  Each person would have to pay the full fee for the service regardless of their ability to pay. Our tax system is based on our "ability to pay."  The more money we earn, the more taxes we pay.  And the opposite is also true.  If we earn a small income, we pay less taxes.

Ingrid lists some of the celebrities who owe a lot of taxes that support my next point. 


Yes, we can all admit that these services are necessary. So it's not a question of Should we pay taxes?, but Should we raise taxes on the rich?

For more than a century it's been generally recognized that the best taxes are progressive-- that is, proportionate to income. 
Various Republican leaders have trotted out the idea of a flat tax, meaning a fixed percentage of income tax levied on everyone. And in their hearts they may be anxious to emulate Maggie Thatcher's poll tax-- a single amount that everyone must pay. Isn't that more fair? Shouldn't everyone pay the same amount?
Why? The rich should pay more taxes, because the rich get more from the government. 

Let's take an example with insurance: if you have a bigger house or a fancier car, you pay more to insure it.

Investments in the nation's infrastructure-- transportation, education, research & development, energy, police subsidies, the courts, etc.-- again are more useful the more you have. The interstates and airports benefit interstate commerce and people who can travel, not ghetto dwellers. Energy is used disproportionately by the rich and by industry.

As for public education, the better public schools are the ones attended by the moderately well off. The very well off ship their offspring off to private schools; but it is their companies that benefit from a well-educated public.

How about social spending? Tempting as it is for the rich to take all the wealth of a country, it's really not wise to leave the poor with no stake in the system, and every reason to agitate for imposing a new system of their own. Think of social spending as insurance against violent revolution-- and again, like any insurance, it's of most benefit to those with the biggest boodle.

So, I'm with you Ingrid, and not just both of us, everyone has to pay the damn taxes! (your pic is cute)