Instructions
During World War II, to pay for the war, the democrats and FDR raised all taxes. At the top income bracket during the war it was 90%. It remained at this rate through the Eisenhower Presidency. Ike endorsed keeping the rate that high to pay off the war debt, not wanting to burden the future generations with it. Now what that rate means is that every dollar past a certain income level was taxed at that rate. In other words if that rate kicked in at $1 million then up to the first million the money is taxed at lower rates. The first $10,000 might be 0%, over 40,000 15% over $500,000 50% and then the first dollar over $1 million the government gets 90 cents. Another example, and to keep it easy, let us assume there are no taxes until $500,000 then it is 50%, then every dollar over $1 million is taxed at 90%. if Dak Prescott is making $66 million this season, the first $500,000 is his to keep. The second $500,000 he keeps half, $250,000. On the final $65 million Dak will pay $58.5 million in taxes and keep $6.5 million ($7.25 million take home in total in that whole large contract out of $66 million) and probably becoming a hard core low taxes republican. The current top tax rate is currently 28% and considered too low by many economists. Our taxes are progressive meaning the more you make the greater percentage they take. Since, and I am assuming here, none of us is making $1million a year (and if you are let me talk to you about some a great ocean front investment property in Kansas with you), what should the tax rate be for every dollar earned past $1 million.Should some income above that amount be exempt, like for a those who created a COVID vaccine, or should some industries pay a higher rate (like entertainers that include athletes, but engineers less). Remember this will include several of you because I expect my students will be very successful, and for some that is financially. In your reasoning remember what the Federal government does pay for and do (roads, airports, national security, healthcare, etc.). In other words what would be a ‘fair’ tax rate for these income blessed folks. At least 250 words
Sample Answer
Sample Answer
A Fair Tax Rate for High-Income Earners: Balancing Wealth Distribution and National Responsibility
During World War II, the United States implemented a top income tax rate of 90% for high-income earners to fund the war effort. This rate remained in place through the Eisenhower Presidency, as a means to pay off the war debt and prevent burdening future generations with financial obligations. In today’s context, with a current top tax rate of 28%, there is a growing debate on whether this rate is too low, especially considering the significant income disparities that exist in society.
When discussing what the tax rate should be for every dollar earned past $1 million, it is essential to consider the concept of fairness in wealth distribution. Those who have reached a certain level of income should contribute proportionately more to support the functioning of society and the common good. In this regard, implementing a more progressive tax system for high-income earners could be a viable solution.
One approach could be to establish a tiered tax system where income above $1 million is taxed at increasing rates. For instance, income between $1 million and $5 million could be taxed at a higher rate than the current top rate, while income above $5 million could face an even higher tax rate. This would ensure that those who have significantly more wealth contribute a fair share to support essential government functions such as infrastructure, national security, and healthcare.
Moreover, exemptions could be considered for certain individuals or industries that provide significant societal benefits. For example, creators of essential vaccines or other groundbreaking innovations could be granted tax exemptions on income above a certain threshold to incentivize further innovation and contribution to public welfare.
In conclusion, determining a fair tax rate for high-income earners involves striking a balance between wealth distribution and national responsibility. By implementing a more progressive tax system for income above $1 million, while considering exemptions for beneficial contributions to society, we can create a fairer tax structure that ensures those who are financially blessed contribute their share to support the common good.
