Should the rich be taxed more?

In many countries around the world and in the U.S. probably more than all of them, there is an ongoing debate whether rich people should be taxed more than those with lower incomes. In the U.S. it is cut and dry. Republicans believe everyone should have the same tax rate and Democrats believe there should be tax brackets with the higher ones having higher taxes. Both sides have economic reasons for their views. These views are actually held by people all over the world, I just find it easy to use the U.S. as an example because it is so clearly defined in their political circles.

For Republicans, the thinking is that it is wrong to give rich people a higher tax rate than lower income people. The rich end up paying more in taxes anyway because tax rates are on percentage and the more you make, the more that works out to in tax dollars. They also believe that it is wrong to effectively penalize someone with a higher tax rate just because they are successful in their career. They also say that rich people often own businesses and will hire others and spend capital which is good for the economy and taxing them more will hinder that. These are all good points.

Democrats on the other hand, believe that if a¬†household earns more money then it can afford to pay more tax and not be hurt by it. They believe that the lower¬†economic class and middle class need more help to get by and thus should be taxed less. This also stems from the notion of giving back once you’ve made it. This is considered to be a more progressive type of thinking and is more common throughout the western world.

It is tough to say that one is clearly right and the other is definitely wrong. The best option depends on many factors that change from country to country and at different times in economic cycles. However, it does appear that in a majority of instances, taxing the rich a little bit more than the middle class and lower class gives more people a chance to meet their daily needs. In other words, if you had to pick one or the other, you are likely better off with rising tax brackets like we have in Canada and the U.S. Sorry Republicans, but you’re usually not right on this issue.