Double and Triple Taxation Must be Eliminated

Double and Triple Taxation Must be Eliminated

President George Bush states that "it's unfair to tax money twice." This statement is actually an example of normative economics and only describes an opinion. It cannot be proven because the term "unfair" is relative to different people; however, not many people would dare to disagree. Especially if the double tax was not aimed only at the large corporations or the richest 10% of the nation but at every hardworking American who brings home a paycheck. Even worse, many of these Americans do not even realize the "double tax," and sometimes even "triple tax," that is imposed on them. Currently, large corporations are required to be taxed a certain percentage of all of their profits. This includes the money from which dividends are derived. When stock holders obtain the dividends from these corporations, the government counts this as individual income and is taxed once again. Six percent of the population would benefit from abolishment of this "double tax."

However, the largest part of the income that is taxed twice is the income from the worker's paycheck. Opposed to the 6 percent of dividend holders, this affects every working American. The income is first taxed as a whole and then Social Security and Medicare tax is also deducted. The money that was for Medicare and Social Security is never seen but is counted as if the individual had an opportunity to spend it. What is worse is much of the Social Security money is received from retirees who are again taxed on the income, creating a "triple tax." For Social Security recipients, there is a fixed amount of income allowed to go untaxed but is taxed once exceeded. However, these base amounts do not change with inflation which creates more and more people who are "unfairly" taxed. Also, this "triple tax" is paid all by the same person whereas the dividend tax is shared by both corporations and stockholders. This double tax is imposed on far more people who make much less money than the dividend holders. The Social Security tax on a worker's paycheck can only be implemented on a certain amount of income, creating a maximum base amount. This base amount does rise with inflation. Therefore, as income increases, the Social Security tax actually decreases. Those who make less money pay a larger percentage of their income to the government through the Social Security tax than the wealthy class does.