Somehow I doubt the person making $20k/year paying the government 20% would see it the same way as the person making $100k/year.

What do you mean?

A few points, but I am not sure which one you are referring to:

- interesting enough actual taxation in the US seems to be mostly flat in practice (after a certain threshold): rich people get more deductions and can hire lawyers to use all the loopholes

- you can have a mostly fixed marginal rate of taxation on income, but still have progression in average rates. Eg give everyone $10k/year as an allowance, and tax at a fixed 20%.

- for taxes on income there's a trade-off between equality, ability to pay, but also blunting incentives and raising revenue. Luckily, if you tax land value instead, you can tax away essentially the whole of land rent without blunting any incentives to work or invest. (So the whole conundrum about the right way to tax income can be mostly side-stepped.)

I'm about to move to Singapore. They have a progressive income tax system with almost no deductions, but the maximum marginal rate is 22%. (VAT is 7%.) Since there system is so simple and rates are low, it's usually easier to just pay instead of trying to find loopholes.

I mean that flat-tax rates punish the poor. One may have to miss a meal to pay their taxes. The other will have a few less bottles of champagne to purchase.

Even in your follow up post as soon as we make provisions for the reality we live in the flat tax goes back to being a progressive tax, again.

So what we really need is a simpler progressive tax rather than a gradually complex flat tax.

The main argument for a flat tax is to simplify the system and make it harder to game. What really punishes the poor are complicated taxes--the kind that people who can afford lawyers and accounts don't pay.

Singapore and Hong Kong seem to do the right thing in terms of taxation: their systems are simple and the income tax is progressive, but the top marginal rates are pretty low by European standards (around 20%).

To help the poor, universal basic income seems like a good idea. It pairs well with my favourite kind of taxation: land value tax. See https://medium.com/basic-income/why-land-value-tax-and-unive... for a pretty insightful rant.

If an income tax is necessary at all, giving everybody a flat allowance per head plus a pretty flat rate should be good enough on the poor? (Otherwise, do whatever Singapore or Hong Kong or Estonia are doing.)

Flat tax is not just about removing thresholds, but also using the same tax rate across the board. If you tax in the same way income, capital gains or corporate profits, don't give a tax exemption for debt, don't charge a stamp duty on property (or charge the same rate on the purchase of all assets, property or not), etc, then you kill all these tax schemes.

Isn't that usually called a broad based tax or so? I mean I mostly agree with what you are saying, just noting that I'm used to different terminology.

Yes, it's a good idea to put eg debt and equity on the same level; don't tax transactions that improve economic efficiency (tax consumption instead for example).

Land value tax is still a great idea for these and other reasons. Eg you can jack the lvt really high and basically tax away all land rent without negatively impacting the economy. So even in an otherwise 'flat tax world' like you describe, it might be a good idea to get the majority of revenue from taxing land rent (and in the wider sense, resource extraction and commons like pollution carrying capacity).

LVT sounds good in theory, but a large number of rich people _are_ acting as rent seekers (they own property, and extract value via rents on people who work/produce actual value on it). It would not be politically feasible, unless the gov't is prepared to fight against those powerful land owners.

Yes, the political feasibility is one big problem. (The other challenge is to figure out how much revenue you could raise---there are some good theoretical arguments that elimination a tax on something else like labour income should increase the local land value and thus land value tax by enough to offset that loss, but I don't know whether that works out in practice.)

There is some hope for the political feasibility: some countries already have land value taxes with various imperfections like Estonia, and some Australian states, and some counties in the US.