notes@iuvax.UUCP (04/12/84)
#R:uiucdcs:29200124:iuvax:2000025:000:1108 iuvax!scsg Apr 11 09:44:00 1984 The fundamental inequity involved in this type of tax deduction is that it will benefit those with more income more than those with less. The person who can afford to buy a $200,000 house will get more of a tax deduction for buying that house than somebody who can only afford to buy a $50,000 house. Such deductions are the reason that the effective tax rate winds up being about %25 for all income groups despite the higher nominal rates for higher incomes. Personally I think it is fair to have a progressive tax schedule in the interests of equity. Such a system promotes equity at the same time that it allows the market to provide incentives for people to move into high demand areas of the economy. I don't think it is any more fair if somebody making $70,000 gets a bigger tax break than somebody making $30,000 than it is that the typical American pays 25% of her income in taxes while 117 millionaires paid absolutely nothing last tax year. The latter just illustrates more dramatically the basic unfairness of current tax laws. tim sevener Indiana University, Bloomington pur-ee!iuvax!scsg