To the editor:
We hear a lot today about tax reform, but not much about tax basics. Taxes are classified as either being regressive or progressive. Regressive taxes are those that place a larger burden on the poor and middle class than on the wealthy.
The most common of these is the sales tax. To illustrate this, consider a gallon of milk, the tax on which is about 30 cents. This places a great burden on the homeless woman who works at minimum wage to feed herself and her family while it is a minute part of a corporate executives $10 million-a-year salary. How about a gallon of gas with a sales tax of about 30 cents? This places a great burden on the working man who has to commute, but is only a small part of the wealthy man’s expenses.
Almost every dime of the working poor is spent on food and other basics and is taxed at about 10 percent. The wealthy do pay sales taxes but not much. As incomes go up, the percentage of them subject to sales taxes goes down.
The most common progressive tax is the income tax. The principle behind this tax is that it is supposed to tax according to how one benefits from the economic system of the U.S. The fact is no one pays income tax on about the first $15,000-$20,000 of their income due to exemptions and deductions. Sadly, 51 percent of Americans now pay no income tax simply because they don’t make enough money.