In almost every aspect of American life, we celebrate the winners. From the medals we award olympians to the promotions we give to our hardest workers, our culture is built on a simple expectation: the more you strive, the more you can earn. That is, of course, if we ignore progressive taxes.
By instituting progressive taxes, we are penalizing success. When people strive for greatness, they will now be limited by governmental regulations purposefully taxing people at different rates. As they impose this tax for people completing the same public service, we abandon the principle of ‘equal justice under the law’. Instead it is now replaced with selective punishment based simply on bank accounts.
Most small businesses are organized as pass-through entities meaning that the business’s profits are not taxed at corporate rates. Instead, they “pass through” to the owner’s personal tax return. Instituting progressive taxes will in turn unfairly affect these small businesses. With the profits treated as personal income, small businesses can quickly push the owner to the highest tax bracket. However, these businesses will now fail, being expected to produce high levels of tax money while working without large corporations’ aid.
Who says the rich won’t pack up and leave? With the money and resources they already possess, the wealthy are able to relocate to places of less taxes, taking their expertise with them. If this “millionaire migration” occurs, they leave the middle class to take on the state’s debt. Between 2020-2021, over $68 billion in Adjusted Gross Income (AGI) moved out of high tax urban counties in the United States. The higher classes have the luxury to pack up and move, and they have. When progressive taxes are instituted in major cities, it will negatively impact the stability of each and every individual once they are the ones presented with heavy taxes they are unable to pay.
Finally, the economic and moral justification of progressive tax rests on the assumption that our government will accurately and efficiently redistribute our wealth. The money small businesses directly hand to their local officials will rarely be seen benefiting the community. They will most likely rather be paying off acute debts and administrative tasks.
We cannot build a prosperous future by punishing the people who built it. Progressive taxation restricts the opportunities of ordinary citizens and threatens to permanently stunt societal growth.