Essay - American Tax System vs. Other Countries the Federal Government First...

American Tax System vs. Other Countries

The federal government first imposed an individual income tax in 1862 as an emergency means of f*****ancing the Civil War. It also established ***** Bureau of Internal Revenue, predecessor ***** the Internal Revenue Service. ***** rates were 3 percent on ***** from $600 to $10,000 and 5 percent ***** income above $10,000. Later in the war the maximum rate *****creased to 10 ***** of *****." (Encarta)

My how times have changed. This paper will compare the tax systems ***** four different countries to the American tax system. The four ***** that ***** been chosen are South Africa, Mexico, Hong Kong, and New Zealand..

First lets attempt to briefly (if that were possible) explain the American ***** system.

***** American Tax System

***** has a progressive t*****x system meaning ***** greatest tax burden is on people who have the most income. The American tax system can be descri*****d as long and complicated. The following summary ***** seek to explain the tax ***** in simple terms.

Individual Income tax: this includes employment earnings, interest income, ***** dividend and capital gains income. In addition there is taxation of income earned from rental properties, royalties, alimony, game winnings (just to name a few). Deductions include Medical expenses, ***** on student loans and mortgage loans, charitable contributions, the cost of state and local taxes. (*****) The following is a t*****x schedule for single individuals for the 2001 tax season.

Single **********

Provided by If taxable income is over but not over the tax is plus % on the excess over Corporate Income Tax: Taxable income ***** corporati*****s is found by subtracting the number of expenses ***** gross profits. Much like the individual ***** taxes corporations are taxed on interest income, dividend income, capital *****, rents, and royalties. The fact that shareholders have ***** pay a dividend t*****x on income that has already been at ***** corporate level is called double *****. This policy is said to discourage the formation of ***** in the U.S. As Follows ***** rates:

If taxable income is over But not over The tax is:

15% of taxable income

7,500 + 25% of ***** over $50,000

1*****,750 + 34% ***** excess over $75,000

22,250 + 39% of excess over $100,000

113,900 + 34% of excess ***** $335,000

3,400,000 + 35% of ***** over $10,000,000

5,150,000 + 38% ***** excess ***** $15,000,000

35% of taxable *****

State and ***** Taxes: In America *****re are also state ***** local taxes such as property tax.

***** argue that the ********** tax system ***** in need of reform. Not only to provide tax breaks ***** the middle class but to also encourage the formation of more bus*****esses. There has been speculation ***** a fl*****t tax rate would be good for America. In the meantime President Bush has introduced a tax cut "The Economic Growth and Tax Relief Reconciliation Act ***** 2001, enacted under ***** administration of ***** George W. Bush, sought to lower taxes. It called for the gradual