Nov 20, 2012

Unconscionably regressive tax systems

In a current democracy, citizen income is taxed away from citizens, even without them realizing it. Most citizens do not realize that they are owners of their countries and are rightfully entitled to the income generated from common properties. Most people believe that current democracies have a progressive tax system. In truth, they have a very regressive tax system.

"A regressive tax is a tax imposed in such a manner that the tax rate decreases as the amount subject to taxation increases. In terms of individual income and wealth, a regressive tax imposes a greater burden (relative to resources) on the poor than on the rich."

As an illustration, the table on the left shows the income tax payable in Singapore. It appears to be progressive. The more a person earns, the higher percentage of tax he has to pay. 


Current Democracy Perspective
Citizen-ownership Democracy Perspective
Earned Income
Tax Payable ($)
Tax Rate
Earned Income + Citizen Income
Tax+ lost Citizen Income
Real Tax Rate
0
0
0.0%
9000
9000
100.0%
1000
0
0.0%
10000
9000
90.0%
5000
0
0.0%
14000
9000
64.3%
20000
0
0.0%
29000
9000
31.0%
30000
200
0.7%
39000
9200
23.6%
40000
550
1.4%
49000
9550
19.5%
80000
3350
4.2%
89000
12350
13.9%
120000
7950
6.6%
129000
16950
13.1%
160000
13950
8.7%
169000
22950
13.6%
200000
20750
10.4%
209000
29750
14.2%
320000
42350
13.2%
329000
51350
15.6%
above 320000
up to 20%
above 329000
up to 20%


However, once we consider the citizen income, the picture is entirely opposite. The table on the right shows the earned income plus a citizen income of $9,000 estimated for every citizen. The regressive tax is obvious and extreme. The poor bears an extremely heavy tax burden.

In Singapore, poverty can be totally eradicated if the political parties and the people go for a citizen-ownership democracy. The political parties, particularly the governing political party, and the people bear a collective responsibility for not eradicating poverty in Singapore.

Freedom from poverty is a fundamental human right - UNESCO

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