Flat tax

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Flat tax

A tax which is levied at the same rate on all levels of income. See also progressive tax.

Flat Tax

A way to structure an income tax where everyone (or nearly everyone) pays the same marginal rate. For example, a flat tax may be set at 15%, and everyone will pay that rate regardless of how much they earn. This contrasts with progressive taxation, where the marginal tax rate increases with increased income. Proponents of a flat tax argue that it provides an incentive for people to earn more (because they keep more of what they earn than under a progressive tax system), which in turn spurs economic growth. Opponents contend that a flat tax deprives the government of revenue and progressive taxation does not disincentivize earning more because, even at higher rates, people keep more after taxes than they would have done if they earned less.

flat tax

An income tax that has a single rate of taxation. For example, a taxing authority may levy a flat tax of 3% against gross income. See also graduated flat tax.

Flat tax.

A flat tax, also known as a regressive tax, applies to everyone at the same rate, as a sales tax does.

Advocates of a flat income tax for the United States say it's simpler and does away with the kinds of tax breaks that tend to favor the wealthy. Opponents say that middle-income taxpayers would carry too large a proportion of the total tax bill.

References in periodicals archive ?
VAT-registered taxpayers and compensation income earners, for instance, are disqualified from using the 8 percent flat income tax rate.
For almost all the measures the Lithuanian flat income tax structure was more effective at reducing income inequality than the graduated rate structure of Poland.
One in four Americans (26.27 percent) support a flat income tax. By comparison, almost three-quarters prefer a more progressive option.
RENUA Ireland plans a flat income tax rate of 23% and will abolish motor tax and replace it with a fuel charge, the party promised yesterday.
Minutes before the economy-focused debate started, the Wall Street Journal published an op-ed by Cruz outlining his tax plan, which calls for a 10 percent flat income tax. Cruz moved quickly early in the debate to tout the fairness of the proposals, saying that under the plan, "no hedge fund manager pays less than his secretary."
North Carolina enacted a flat income tax with lower rates and lowered corporate taxes.
Bill 2, An Act to Restore Fairness to Public Revenue, brought an end to Alberta's 10 per cent flat income tax. The personal income tax rate remains at 10 per cent for those earning less than $125,000.
The state has a flat income tax rate of 5.2 percent.
Currently, Bulgarians pay flat income tax rate of 10% collected by the National Revenue Agency and channeled into the central government budget.
Anti-inequality advocates would caution that even though this approach is likely to favor income taxes on wealthier groups, some states may impose flat income tax rates instead of progressive schemes that have higher rates at higher income brackets.
Compared to France, Russia has a flat income tax rate of 13%.
Russia has a flat income tax rate of 13 percent compared to the 75% on income over one million euros ($1.32 million) that Hollande wants to levy in France.