What is a Flat Rate Tax?
A flat rate tax was a common taxation practice in earlier times, and in the last few decades has been revisited by numerous politicians as the best plan for pursuing fair taxation. A few countries have recently instituted the flat rate tax, including several of the Baltic countries. Other countries are considering it, since some people believe a flat rate tax is the fairest type of taxation program available. The flat rate tax can be compared to a progressive tax rate. With progressive rates, percentage of income deducted for taxes increases with more money made. The lowest incomes pay very little in taxes, while higher incomes pay a far greater percentage of their income. These percentages can be mitigated in part by the number of deductions and tax breaks a person is able to take, lowering the amount of what is considered taxable income. Most propositions for a flat rate tax suggest built in deductions for people, especially in the lower income spectrum. The percentage of tax applied
