# Why is it unfair for the poor to be tax exempt? **URL:** \ **Category:** Great Debates\ **Created:** [October 27, 2008, 3:29pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773 "2008-10-27T15:29:19Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![mswas](https://avatars.discourse-cdn.com/v4/letter/m/e99b99/32.png) [@mswas](https://boards.straightdope.com/u/mswas)\ **Post date:** [October 27, 2008, 8:55pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/61 "2008-10-27T20:55:07Z")
> [@mazinger\_z](#): > > I think this is a rather specious argument, however, I have no cites to the contrary, so I guess we’ll just to argue it out. Do the rich really use the government more than the poor? Yes the rich really do use the government more than the poor. > [@](#): > > Don’t poorer neighborhoods have more cops? I can’t remember seeing the last time I saw a cop on patrol in my neighborhood. Don’t we all benefit from a stable society? Since my dad found stable employment when I was a kid, I have never been to a county hospital. Who receives more food stamps, job training, and other welfare disbursements? Which is more likely to go to jail? Which group is more likely to get a visit from the sheriff for an eviction? In a rural town that is poor you are going to have fewer cops than a rural town that is wealthy. In an urban ghetto, there may be more cops, but there are also more people than in a suburban neighborhood. Yes, there are more cops on the street in wealthier urban neighborhoods than poor urban neighborhoods. The schools are better in wealthier districts, etc… > [@](#): > > Are you honestly arguing that if not for government, we would be a feudal society or worse? Yes, without a doubt. History shows that in 100% of cases the fall of a stable government results in feudalism. > [@](#): > > In my entire career of writing and negotiating multi-million dollar transactions, I have never sued nor been sued (knock on wood, though my company is no stranger to lawsuits, which is why we have a litigation dept). For the most part, we are self-policing. Congratulations on being good at your job. > [@](#): > > Honestly, I think most people’s use of the government is passive (I include good roads and infrastructure). It’s equally specious to put a value on how much someone like Bill Gates utilizes the government because he has so much to protect. If government were to break down, the rich would pay for their order directly, and fairly, by hiring their protection outright, i.e. a feudal system. Who will get better service from the police when their home is broken into? Someone living in the trailer park or Bill Gates? > [@](#): > > In every case you’ve shown, even Reggie Bush, the leverage shown is that the person in a given scenario has been productive. If you’re going to risk money on an unknown quantity, you’re gambling. Yes, but is Reggie Bush more productive than the Janitor at the stadium? ---
**Author:** ![magellan01](https://avatars.discourse-cdn.com/v4/letter/m/45deac/32.png) [@magellan01](https://boards.straightdope.com/u/magellan01)\ **Post date:** [October 27, 2008, 9:13pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/62 "2008-10-27T21:13:33Z")
> [@mswas](#): > > Yes the rich really do use the government more than the poor. Cite? > [@mswas](#): > > In a rural town that is poor you are going to have fewer cops than a rural town that is wealthy. In an urban ghetto, there may be more cops, but there are also more people than in a suburban neighborhood. Yes, there are more cops on the street in wealthier urban neighborhoods than poor urban neighborhoods. The schools are better in wealthier districts, etc… Yes, nut these people chose to live in neighborhoods where everyone there pays higher property and sales tax. People chose to pay for those things. If you live in a wealthy town with lots of cops, even if you earn on the lower end of the scale (relative to others in that town), you get the same benefits. > [@mswas](#): > > Yes, without a doubt. History shows that in 100% of cases the fall of a stable government results in feudalism. I hardly think that’s the case. Dictatorships come to mind. Not that it has anything to do with this discussion. > [@mswas](#): > > Yes, but is Reggie Bush more productive than the Janitor at the stadium? Yes. He is. The janitor provides a service with value that can rather easily be duplicated many other people. The Reggie Bushes of the world have unique skill sets, difficult to be found a]even though millions of dollars are spent each year trying to create or find them. And the reason Reggie makes millions now as opposed to his USC days are laws. a student cannot be paid to play. If he has the option to go pro he has to weigh the benefits of more time at school and a degree against the immediate gratification of a multi-million dollar contract. Also, if he stays in school and does really well another year, he’ll be able to demand more in the end. ---
**Author:** ![Whack-a-Mole](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/whack-a-mole/32/141_2.png) [@Whack-a-Mole](https://boards.straightdope.com/u/Whack-a-Mole)\ **Post date:** [October 27, 2008, 9:13pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/63 "2008-10-27T21:13:50Z")
> [@magellan01](#): > > That’s fine. But you need to be able to point to a midpoint. If not, any discussion of the options _in terms of fairness_ will simply assure mutual masturbation; it’s like us each arguing if orange is more red or more yellow, without being able to point to a pure orange. I think to point to a “perfectly fair” tax system we would have to suppose things that simply do not exist. For instance, perfect and immediate knowledge of your economic standing compared to everyone else and then modify the tax you pay at that moment to be perfectly adjusted to “hurt” you just as much as a billionaire and as a person on Welfare. Even then is that “fair”? Are we talking income tax or gasoline tax? Should a billionaire pay a higher tax to gas up his moped as it takes you to fuel your moped? Maybe but only if we then try to assume what the moped will be used for. Is the poor guy going to work on his moped to feed his family while the billionaire is just zooming around for fun? Should that matter even if such a thing could be discerned? In the end I do not think there is an orange orange to point to. Taxes have inherent inequalities that are unavoidable. The question remains which side bears more of the burden than the other? ---
**Author:** ![Markxxx](https://avatars.discourse-cdn.com/v4/letter/m/5daacb/32.png) [@Markxxx](https://boards.straightdope.com/u/Markxxx)\ **Post date:** [October 27, 2008, 9:16pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/64 "2008-10-27T21:16:40Z")
Is it unfair. Yes, obviously it is. Everyone should pay the same, otherwise it isn’t fair. BUT the real question is, “Is it a bad thing.” Look at it like this, Bill Gates and I are walking down the street. We each go to the ATM and get $500.00. We turn the corner and get robbed. Is that fair? Yeah we both lost the same amount. Except Bill just goes back to the ATM and gets more money. I suddenly have no money for rent or food or transportation. See the difference, because Bill can AFFORD more it makes sense for him to pay more. ---
**Author:** ![magellan01](https://avatars.discourse-cdn.com/v4/letter/m/45deac/32.png) [@magellan01](https://boards.straightdope.com/u/magellan01)\ **Post date:** [October 27, 2008, 9:20pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/65 "2008-10-27T21:20:05Z")
> [@Whack-a-Mole](#): > > I think to point to a “perfectly fair” tax system we would have to suppose things that simply do not exist. For instance, perfect and immediate knowledge of your economic standing compared to everyone else and then modify the tax you pay at that moment to be perfectly adjusted to “hurt” you just as much as a billionaire and as a person on Welfare. > > Even then is that “fair”? Are we talking income tax or gasoline tax? Should a billionaire pay a higher tax to gas up his moped as it takes you to fuel your moped? Maybe but only if we then try to assume what the moped will be used for. Is the poor guy going to work on his moped to feed his family while the billionaire is just zooming around for fun? Should that matter even if such a thing could be discerned? > > In the end I do not think there is an orange orange to point to. Taxes have inherent inequalities that are unavoidable. The question remains which side bears more of the burden than the other? I don’t disagree with any of this, but the point remains: if you cannot point to a fair tax system, either existing of fictional, the discussion is a waste of time. You will simply deem any system you perceive as not being progressive enough as being unfair. You want fairness, I want fairness. I provided what I considered fair and why. I’m genuinely interested in what, specifically, you would deem fair. Please lay it out. Just start with the income tax to make it simple. Not to say that that will tell the whole story. But it will be a starting point. ---
**Author:** ![erislover](https://avatars.discourse-cdn.com/v4/letter/e/71e660/32.png) [@erislover](https://boards.straightdope.com/u/erislover)\ **Post date:** [October 27, 2008, 9:22pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/66 "2008-10-27T21:22:57Z")
> [@magellan01](#): > > Just start with the income tax to make it simple. Not to say that that will tell the whole story. But it will be a starting point. As an _income tax_, I believe a proportional tax is fair, after a standard deduction (i.e., your typical negative income tax scheme). What the deduction should be and what the rate should be are different questions, but, I personally feel that scheme is fair. Now, what counts as “income”… 😉 ---
**Author:** ![magellan01](https://avatars.discourse-cdn.com/v4/letter/m/45deac/32.png) [@magellan01](https://boards.straightdope.com/u/magellan01)\ **Post date:** [October 27, 2008, 9:23pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/67 "2008-10-27T21:23:02Z")
> [@Markxxx](#): > > Is it unfair. Yes, obviously it is. Everyone should pay the same, otherwise it isn’t fair. > > BUT the real question is, “Is it a bad thing.” > > Look at it like this, Bill Gates and I are walking down the street. We each go to the ATM and get $500.00. > > We turn the corner and get robbed. Is that fair? Yeah we both lost the same amount. Except Bill just goes back to the ATM and gets more money. I suddenly have no money for rent or food or transportation. > > See the difference, because Bill can AFFORD more it makes sense for him to pay more. How much more would be fair? What system do you propose? ---
**Author:** ![magellan01](https://avatars.discourse-cdn.com/v4/letter/m/45deac/32.png) [@magellan01](https://boards.straightdope.com/u/magellan01)\ **Post date:** [October 27, 2008, 9:24pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/68 "2008-10-27T21:24:51Z")
> [@erislover](#): > > As an _income tax_, I believe a proportional tax is fair, after a standard deduction (i.e., your typical negative income tax scheme). What the deduction should be and what the rate should be are different questions, but, I personally feel that scheme is fair. > > Now, what counts as “income”… 😉 By “proportional”, I assume you mean directly proportional, the same percent, a flat tax. Is that right? ---
**Author:** ![mazinger\_z](https://avatars.discourse-cdn.com/v4/letter/m/5f9b8f/32.png) [@mazinger\_z](https://boards.straightdope.com/u/mazinger_z)\ **Post date:** [October 27, 2008, 9:56pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/69 "2008-10-27T21:56:35Z")
> [@mswas](#): > > Yes the rich really do use the government more than the poor. Cite? > [@](#): > > Yes, but is Reggie Bush more productive than the Janitor at the stadium? :rolleyes: Is this a serious question? ---
**Author:** ![Whack-a-Mole](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/whack-a-mole/32/141_2.png) [@Whack-a-Mole](https://boards.straightdope.com/u/Whack-a-Mole)\ **Post date:** [October 27, 2008, 10:05pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/70 "2008-10-27T22:05:51Z")
> [@magellan01](#): > > I’m genuinely interested in what, specifically, you would deem fair. Please lay it out. Just start with the income tax to make it simple. Not to say that that will tell the whole story. But it will be a starting point. Well, if you want explicit percentages at particular incomes I simply cannot get that specific. I will say I believe in a progressive income tax rate. I think what we have now is somewhat close. I’d like to see all loopholes closed (you make $XXX you pay $XX taxes…period). No deductions save I would keep deductions for non-profits since I think they benefit society and are (generally) better doing many things than having the government step in. If the above were done shitcan the Capital Gains tax. If you roll your gains immediately back into investments you pay no tax. Whatever ends up in your bank account is taxed as income. More than anything I would very, very much like to see a drastically simplified tax system rather than the obscenely complex system we have now. Obviously that is broad strokes but a start. ---
**Author:** ![magellan01](https://avatars.discourse-cdn.com/v4/letter/m/45deac/32.png) [@magellan01](https://boards.straightdope.com/u/magellan01)\ **Post date:** [October 27, 2008, 10:17pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/71 "2008-10-27T22:17:58Z")
> [@Whack-a-Mole](#): > > Well, if you want explicit percentages at particular incomes I simply cannot get that specific. > > I will say I believe in a progressive income tax rate. I think what we have now is somewhat close. I’d like to see all loopholes closed (you make $XXX you pay $XX taxes…period). No deductions save I would keep deductions for non-profits since I think they benefit society and are (generally) better doing many things than having the government step in. If the above were done shitcan the Capital Gains tax. If you roll your gains immediately back into investments you pay no tax. Whatever ends up in your bank account is taxed as income. > > More than anything I would very, very much like to see a drastically simplified tax system rather than the obscenely complex system we have now. > > Obviously that is broad strokes but a start. Fair enough. But let’s try it this. Six people, they each make the following amounts: Person A: $15,000 Person B: $40,000 Person C: $80,000 Person D: $200,000 Person E: $400,000 Person F: $800,000 How much tax do you think each of them should pay? and what is your rationale for arriving at the numbers you do? ---
**Author:** ![Clothahump](https://avatars.discourse-cdn.com/v4/letter/c/51bf81/32.png) [@Clothahump](https://boards.straightdope.com/u/Clothahump)\ **Post date:** [October 27, 2008, 11:47pm UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/72 "2008-10-27T23:47:47Z")
> [@mswas](#): > > Something I’ve seen when discussing the notion of Obama’s tax policy is that it’s ‘unfair’. I don’t understand why it’s unfair when the unequal distribution of wealth is so unfair. > > Generally I find when people are using the fairness argument they ignore that completely. They talk about the ‘poor robbing the rich’ as though the rich somehow deserve to be disproportionately wealthy as compared to the relative effort of their labor. > > I understand pragmatically why we want a competitive system and the underlying philosphical notions of capitalism, but I don’t understand why people can bring it up as an argument of ‘fairness’, when the system is unfair to begin with. Hearkening back to the days when the kids were single-digit midgets and we heard that constantly: “IT’S NOT FAIR!!” Bullshit. ---
**Author:** ![msmith537](https://avatars.discourse-cdn.com/v4/letter/m/d9b06d/32.png) [@msmith537](https://boards.straightdope.com/u/msmith537)\ **Post date:** [October 28, 2008, 12:11am UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/73 "2008-10-28T00:11:47Z")
> [@magellan01](#): > > Because the wealth is not be re-distributed. Wealth is being collected and used for the _common_ good. Most of the things you mention are a form of insurance. I think we’re talking about 2 different things here. A progressive tax structure is not the same thing as wealth re-distribution. Let me ask you. Here is the 2008 tax rate by income. What should be the flat rate we tax everyone? Should we tax at the minimum of 15% or should people making $15,000 give over a third of their income? What would be the most fair? ``` Income Tax Rate Tax ``` Person A: $15,000 15% $2,250 Person B: $40,000 25% $10,000 Person C: $80,000 28% $22,400 Person D: $200,000 33% $66,000 Person E: $400,000 35% $140,000 Person F: $800,000 35% $280,000 ---
**Author:** ![magellan01](https://avatars.discourse-cdn.com/v4/letter/m/45deac/32.png) [@magellan01](https://boards.straightdope.com/u/magellan01)\ **Post date:** [October 28, 2008, 12:31am UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/74 "2008-10-28T00:31:13Z")
> [@msmith537](#): > > I think we’re talking about 2 different things here. A progressive tax structure is not the same thing as wealth re-distribution. > > While that is debatable, I was referring to Obama’s plan, which combines a progressive more progressive tax structure with the doling out of money to individuals, some of whom do not pay taxes. In fact, prior to his recent tweaking of his plan, didn’t even work. And, yes, I know there are taxes other than income taxes. > > Let me ask you. Here is the 2008 tax rate by income. What should be the flat rate we tax everyone? Should we tax at the minimum of 15% or should people making $15,000 give over a third of their income? What would be the most fair? > > ``` > Income Tax Rate Tax > > ``` > > Person A: $15,000 15% $2,250 > Person B: $40,000 25% $10,000 > Person C: $80,000 28% $22,400 > Person D: $200,000 33% $66,000 > Person E: $400,000 35% $140,000 > Person F: $800,000 35% $280,000 I’m perfectly willing to have almost any number. That number should be based on what the government needs, and it should be as low as possible. And because of the burden it would place on those on the lower end of the scale, the government would be forced to do what they should morally do: keep the number as low as possible. The concept that should rule the day is fairness. ---
**Author:** ![erislover](https://avatars.discourse-cdn.com/v4/letter/e/71e660/32.png) [@erislover](https://boards.straightdope.com/u/erislover)\ **Post date:** [October 28, 2008, 1:10am UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/75 "2008-10-28T01:10:30Z")
> [@magellan01](#): > > By “proportional”, I assume you mean directly proportional, the same percent, a flat tax. Is that right? Yep, just so. ---
**Author:** ![magellan01](https://avatars.discourse-cdn.com/v4/letter/m/45deac/32.png) [@magellan01](https://boards.straightdope.com/u/magellan01)\ **Post date:** [October 28, 2008, 1:15am UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/76 "2008-10-28T01:15:25Z")
> [@erislover](#): > > Yep, just so. Then I am forced to commend you on you critical thinking abilities. If only were it contagious. ---
**Author:** ![erislover](https://avatars.discourse-cdn.com/v4/letter/e/71e660/32.png) [@erislover](https://boards.straightdope.com/u/erislover)\ **Post date:** [October 28, 2008, 1:18am UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/77 "2008-10-28T01:18:47Z")
> [@erislover](#): > > Yep, just so. Actually I realize that my post is ill-worded. I do mean just a negative income tax scheme with a standard _refund_, not a _deduction_. This makes it mildly progressive. ---
**Author:** ![magellan01](https://avatars.discourse-cdn.com/v4/letter/m/45deac/32.png) [@magellan01](https://boards.straightdope.com/u/magellan01)\ **Post date:** [October 28, 2008, 1:20am UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/78 "2008-10-28T01:20:43Z")
> [@erislover](#): > > Actually I realize that my post is ill-worded. I do mean just a negative income tax scheme with a standard _refund_, not a _deduction_. This makes it mildly progressive. And you were doing so well…😉 So, the next question is how would you structure the refund? Who gets it and how much? ---
**Author:** ![The\_Flying\_Dutchman](https://avatars.discourse-cdn.com/v4/letter/t/9fc348/32.png) [@The\_Flying\_Dutchman](https://boards.straightdope.com/u/The_Flying_Dutchman)\ **Post date:** [October 28, 2008, 1:25am UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/79 "2008-10-28T01:25:40Z")
> [@mswas](#): > > Something I’ve seen when discussing the notion of Obama’s tax policy is that it’s ‘unfair’. I don’t understand why it’s unfair when the unequal distribution of wealth is so unfair. There is nothing unfair about the unequal distribution of wealth. Unless we are crooks or do receive money from the government we haven’t earned, we all get our income from other people and institutions that voluntarily give it to us. But for the government to take money from person A and give it to person B, that is redistribution and that is essentially unfair. > [@](#): > > Generally I find when people are using the fairness argument they ignore that completely. But the other side complains about the tax cut for everone as a government handout for the the rich . They ignore the fact that in essence when you cut everyone’s taxes by the same percentage, a rule established in the first place to make the rich pay more, you are employing the fairest way to reduce taxes. > [@](#): > > They talk about the ‘poor robbing the rich’ as though the rich somehow deserve to be disproportionately wealthy as compared to the relative effort of their labor. They do. They EARNED their wealth. > [@](#): > > I understand pragmatically why we want a competitive system and the underlying philosphical notions of capitalism, but I don’t understand why people can bring it up as an argument of ‘fairness’, when the system is unfair to begin with. I don’t know whether the status quo in taxation is fair or not or whether the proposed changes by Obama is fair or not. What I do know is that the rich benefit disproportionately compared to the poor when it comes to the legal system and the services that the government provides. For example, the police never bothered to check for fingerprints on my stolen vehicle after it was returned completely damaged. It was my only means of transportation and all I could afford. It was my bicycle. Why should I pay as much taxes as the next guy. And, I think its fair to have a minimum income exempt from tax that is reflective of basic needs.That doesn’t help the middle class though, and I’m not exactly comfortable that this class “deserves” special treatment for a tax break. If anything, the fairest “redistribution” is to raise the tax exemption at the low end and hold the line everywhere else. Yeah, I know its confusing. ---
**Author:** ![tomndebb](https://avatars.discourse-cdn.com/v4/letter/t/b9e5f3/32.png) [@tomndebb](https://boards.straightdope.com/u/tomndebb)\ **Post date:** [October 28, 2008, 1:31am UTC](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773/80 "2008-10-28T01:31:17Z")
> [@msmith537](#): > > Here is the 2008 tax rate by income. > . . . > Income Tax Rate Tax > Person A: $15,000 15% $2,250 > Person B: $40,000 25% $10,000 > Person C: $80,000 28% $22,400 > Person D: $200,000 33% $66,000 > Person E: $400,000 35% $140,000 > Person F: $800,000 35% $280,000 Just to keep the Straight Dope in mind, those are not the actual tax rates imposed. The person earning $40,000 is taxed at 25% of the money earned above $28,400, but is only taxed at 15% up to the $28,400. The other numbers are similarly affected, so that the actual taxes (before deductions, etc.) would be: ``` Income Tax Rate Tax ``` Person A: $15,000 15% $2,250 Person B: 40,000 25% 6,344 vs $10,000 Person C: $80,000 28% $16,378 vs $22,400 Person D: $200,000 33% $51,751 vs $66,000 Person E: $400,000 35% $118,597 vs $140,000 [Previous page](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773.md?page=3) [Next page](https://boards.straightdope.com/t/why-is-it-unfair-for-the-poor-to-be-tax-exempt/469773.md?page=5)