US Taxation case study assignment help Tax System Assignment Help | US & Australia Taxation System Help Introduction With the increasing complexity and unfairness of current tax system in US, the demand of alternative tax system has increased in the country. Since the current tax system produces wide differences between the rich and poor people in terms of paying tax, there has been significant increase in the demand of alternative tax system (Terrell, 2004). The inability of current tax system to meet social and economic obligation has given boost to the demand of specific changes in the country’s tax system. This US and Australia case study assignment help paper includes deep analysis of flat income tax as alternative tax system with comparing it from current tax system. The impact of both tax systems over the social and economical condition of country would also be discussed.

Alternate Tax System Of US and Australia

 Alternate tax system is merely the replacement of current tax system to meet such obligations that the current tax system is unable to meet. In US, the flat income tax would replace the current tax system under which individuals have to pay tax at different rates depending upon their income. The flat income tax is quite easy to compute in compare to the current income tax system of the country. According to the Heritage Foundation, the taxpayers in US spend almost 6 billion hours in filling their income tax forms (Piketty & Saez, 2007). Alternate system would further simplify the complexity of current income tax as the same rate of tax applies on each individual instead of the current tax system in which different rates are applicable for different individuals. The reporting of tax filing will also become simple with implementing flat income tax. Government would be able to generate more tax with this alternative tax system as because of current tax system many of the big tax payers are always trying to save their taxes. According to Heritage Foundation of US, the alternate flat tax system is quite fair than the current tax system as it would promote equality between the tax payers. Impact of Current Adjustment Elimination The elimination of current adjustments from AGI would have great impact over the working poor and middle class people. Although it would have minor impact over the wealthy class of people, but it would affect them financially. Under working poor and middle class the elimination would lead to increase in the tax liability of both the social class as the expenses incurred on health saving, retirement plan and students loan etc would not be adjusted (The Joint Committee on Taxation, 2008). This would further impact their living standards as they would have to pay more taxes and saving would be less. But in relation to wealthy class of people, it would not have a great impact as their earning is so high. In the same way, the elimination of adjustment for AGI and credit against income tax would also have severe impact over different groups in society. Elimination of different tax credits would restrict tax payers from saving any extra amount. With elimination of earned income credit and retirement saving credit, it would be very difficult to survive for working poor and middle class people (Diamond & Zodrow, 2008). All these elimination would only benefit the government and the most suffering class of people would be the middle class people as they have to maintain their standard with same income. Flat Income Tax Advantages The flat income tax system would have great benefit to the society as it encourages the same tax at same income level. The flat tax system also contributes to the economic development as it maintains the flow of tax in both situations such as during recession and rapid growth of economy. With this tax system, government could also ensure that proper allocation of resources is increasing the economic efficiency of the country (Maloney, Raabe & Smith, 2011). At the same time, it also addresses the societal necessities through making equal investment into different saving plans. Since people do not have to pay much in respect of their taxes, they could easily invest this amount to fulfill their necessities. At the same time our US assignment help experts says that, it also fulfills the concern of current tax system through increasing the amount of taxes. People who used to save their taxes under previous system would honestly pay their taxes. The simplicity and broad base of flat income tax would further encourage individuals to earn more for accumulating their family wealth. In today’s economy, it is very important to have flat income tax system (Hall & Rabushka, 2007). As the economic uncertainty is increasing, it has helped people to accumulate their income quite effectively. It would help economies to continue their growth in adverse conditions also. The government would also be able to save administrative cost as the time taken to recheck income tax filed by the individuals would be minimized. With less time, government would also be able to save the cost incurred on its checking. Apart from this, government would be able to utilize this time on other productive activities. The changes in the special interest would further increase the effectiveness of flat income tax system in the country (Dalsgaard, 2005).  With this change, government would be able to minimize its expenses over fiscal stimulus along with the expenses over energy and housing. This would further lead to maintain a constant price in the energy and housing market. Consumption must be included in the flat tax system to manage revenue generation and social behavior as it would provide information related to the source of income of different individuals. It would help government to bring transparency into the system. Since consumption is directly related with income, it is very important to include this aspect into alternative tax system. The tax on the use of natural resources and consumer purchase should continue as it would restrict people from unnecessary purchase and also keep its natural resources long lasting. Apart from US, there are countries like, Belarus and Bulgaria that use same tax rate for each individual in the country (The Joint Committee on Taxation, 2008).  It has not only helped to maintain transparency in the system, but have also increased viability of tax system in the country as each individual has to pay same rate of tax on their earnings. As the importance of taxes is increasing for countries, there is a need to keep transparency into the system along with equal tax rate. Conclusion The above discussion by our US Taxation case study assignment help  states the flat income tax is the best alternative tax system over the current US tax system. Since the current tax system of US contains several loopholes like complexity, social and economic concern, alternative tax system in the form of flat income tax would be good choice for the government. It would successfully mitigate the lacking with current system ensuring sound collection of taxes. Dalsgaard, T. (2005). U.S. Tax Reform: An Overview of the Current Debate and Policy Options. USA: International Monetary Fund. Diamond, J. & Zodrow, G. (2008). Fundamental Tax Reform: Issues, Choices, and Implications. USA: MIT Press. Hall, R. & Rabushka, A. (2007). The Flat Tax. USA: Hoover Press. Maloney, D., Raabe, W. & Smith, J. (2011). South-Western Federal Taxation 2012. USA: Cengage Learning. Piketty, T. & Saez, E. (2007).  How Progressive is the U.S. Federal Tax System? A Historical and International Perspective. Journal of Economic Perspectives, 21 (1), 3–24. Terrell, E. (2004). History of the US Income Tax. Retrieved from http://www.loc.gov/rr/business/hottopic/irs_history.html The Joint Committee on Taxation. (2008). Description and Analysis of Alternative Wealth Transfer Tax Systems. Retrieved from https://www.jct.gov/publications.html?func=startdown&id=1318