Flat Tax Plan Income Tax News
Flat Tax Plan
Apparantly, Arizona Legislature is racing to finalize a budget compromise that includes a controversial flat tax plan that would set a rate of 2.8 percent on all income levels and exempt the first $10,000 in income for individuals and $20,000 for couples.
While the state of Arizona currently has five income tax brackets all ranging from 2.59 percent for couples making $20,000 or less to 4.54 percent for couples making $300,001 or more.
The flat tax would translate into a cut of $450 million and go into effect in 2012. The plan would also allow for mortgage interest payments and charitable contributions that are deducted from federal income taxes to be used in state income tax filings.
Many conservative and anti-tax groups back Flat taxes. It is said that they will help spur investments. While teachers unions and Democrats are among the critics who say lost revenue could cut into spending on education and health care.
Below is a income tax comparison:
Current Individual Income Tax Rates
$0 to $10,000, Individuals - 2.59 percent
$0 to $20,000, couples - 2.59 percent
$10,001 to $25,000, individuals - 2.88 percent
$20,001 to $50,000, couples - 2.88 percent
$25,001 to $50,000, individuals - 3.36 percent
$50,001 to $100,000, couples - 3.36 percent
$50,001 to $150,000, individuals - 4.24 percent
$100,001 to $300,000, couples - 4.24 percent
$150,001 and over, Individuals - 4.54 percent
$300,001 and over, couples - 4.54 percent
New Flat income tax
$0 to $10,000, individuals - 0 percent
$0 to $20,000, couples - 0 percent
above $10,000, individuals - 2.8 percent
above $20,000, couples - 2.8 percent
Source: Arizona LegislatureHow do you feel about a Flat tax in your state? Yay? Nay? Why? Or, Why Not?
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