This plan would convert the current bracket tax system into a block tax system.
This Block system would be composed of seven different blocks with each block paying a different percentage.
- $0 - $5,000: 0% taxes. This first block would pay no taxes.
- $5,000.01 - $50,000: >20% taxes. This second block would pay up to twenty percent in taxes, up to $9,000 as you are only paying taxes on $45,000 instead of the full 50k. Anyone making anything over 50k a year would automatically pay 9k if the rate were at 20%.
- $50,000.01 - $150,000: >20%. This third block would pay a maximum of $20,000 in taxes for this block.
- $150,000.01 - $300,000: >20%. The forth block would pay a maximum of $30,000 in taxes for this block.
- $300,000.01 - $500,000: >20%. The fifth block would pay a maximum of $40,000 in taxes for this block.
- $500,000.01 - $1,000,000: >25%. This block's maximum percentage would be slightly increased by 5% and they would pay up to $125,000 for the block.
- $1,000,000<: >25%. The final block would consist of anything over one million dollars.
Say someone made one million dollars per year at the above rates they would pay a total of $224,000 per year at the rates listed above.
This Block system would also allow those making less money to pay less in taxes while those with more money pay more, the rates I put down above are merely suggestions for the maximum rates, with a state maximum income tax rate of 20 - 25%.
I may not have much of an idea of what the current tax rates are, but I am merely making suggestions.