From David Leonhardt's newsletter today on FAIR TAX...
IDEA OF THE DAY: THE ‘FAIR TAX’
Many states have tax systems that are regressive: They take a greater share of income from the poor than the rich. And because a disproportionate share of the richest taxpayers are white, these state tax systems also widen racial wealth gaps.
In Illinois, for example, the lowest-earning fifth of the population pays 14.4 percent of its income in state and local taxes, ...
It would cut taxes for the 97 percent of residents who make less than $250,000 in taxable income — and raise taxes for the remaining 3 percent, according to the study. If the Fair Tax had been in place over the past two decades, it would have effectively transferred $50 billion in wealth from this richest 3 percent to everyone else.
according to a new study by the Institute on Taxation and Economic Policy. The middle-earning fifth pays 12.6. The highest-earning 1 percent of residents pays 7.4 percent.
This year, Illinoisans will vote on whether to change this system, through a constitutional amendment to authorize a more progressive tax, called the Fair Tax.