Facebook Story of the Day: The Flat Tax
In response to the announcement of Republican Presidential Candidate Rick Perry's "Flat Tax" plan, viewers wanted to know what a flat tax is and how it affects citizens; that's our Facebook Story of the Day.
A flat tax is where everyone pays the same percentage in taxes regardless of their income. The nation currently uses a "progressive" tax system where those who are rich pay more than the poor, according to an Albany State economics professor.
Dr. Amaechi Nwaokoro, Associate Professor at ASU's College of Business, says a flat tax is supposed to simplify the tax system. He says it puts the burden of tax on the poor.
"The rich would prefer flat tax because it's simple and it's equitable because everybody would pay the same rates; but from the other perspective it's not going to be progressive, it's going to be regressive," says Nwaokoro.
He says people working with the tax system could lose their job as well because taxes would be easier to understand.