Peculiarities of the Flat Tax System - Essay Example

Countries like Latvia, Estonia, and Lithuania have imposed a flat tax on individuals and businesses have experienced economic growth. It is already implemented in many states of the US.

Flat tax removes exemptions, tax credits, and deductions, thus eliminating unfairness towards some activities and behaviors. Removing deductions, complex tax brackets and tax credits also makes the tax code simple, which in turn makes compliance easier. Another advantage of the flat tax system is to eliminate double taxation, by applying a tax on earned income.

Faction the supports flat tax systems says that it promotes economic growth by avoiding a system in which one is fined in higher taxes for earning more money of being more productive and hard-working.

Flat tax encourages businesses and individuals for being the same for all earnings. A flat tax is being thought of as the way to increase overall tax revenue and economic stability.