PT 76 RC 4
Posted: Thu Dec 03, 2015 7:21 pm
Can anyone explain this comparative reading comp passages? For me, it's very difficult to understand.
I sincerely appreciate your help!
I sincerely appreciate your help!
****IGNORE THIS, IT'S ABOUT PT 73********
The two authors are arguing about taxation systems. Author A is pro-flat tax, while author B is pro-graduated tax, and anti-flat tax.
Author A argues that a flat tax, in which people of all income brackets pay the same percentage, is as fair as any other system, despite the common criticism that it rules out high-income earners from paying more and is thus less progressive.
In P3, the author goes on to explain that under a flat tax, there is a threshold of income that will not be taxed (e.g. everyone's first $30,000 is untaxed) while everything above that is taxed. These two factors can be adjusted to make the system more or less "progressive," depending on what the state wants to do. The author also explains that the rich tend to underpay on their taxes in most developed countries without a flat tax system, because they have so many incentives to do so, and because tax law is so complicated and full of loopholes.
Author B defends "graduated" taxing, in which people pay different percentages on different "layers" of their taxes. For example, everyone might pay 3% on their first $30,000, but if you make more than that, you'll pay, say 6% on your income from $30,000-$50,000. And so on and so forth if you make more income than that. So everyone technically gets the same tax rates, but higher earners pay more taxes because their upper "layers" are taxed more heavily.
P3 criticizes the flat taxes that Author A defended, stating that jumping between a threshold of no taxes vs. taxes is too extreme and will ultimately put a big burden on the middle class. Author B is picturing the following scenario under flat taxation: the poor pay no taxes because their income is below the tax threshold, while the middle and upper classes pay the same tax rate on their income exceeding that threshold. This screws the middle class over, since they have to pay the same rates as the rich despite having much less money.
Do you have a more specific question or questions about the passage?