/biz/ - Business & Finance

>>51449227
This here; when you have a fiat currency, income taxes only have three purposes. The first is to act as a brake on inflation. If we had a small government, say the size the US had prior to WWI, no income tax would be needed for this purpose; spending would be small enough that inflation would be tolerable.

The second is stifle how much money the upper middle class and lower rich class (think small business owners & well paid professionals, like doctors) has, reducing their ability to be threat to the really rich, in terms of political power & business competition. That is why almost every "tax the rich" proposals hits those groups the hardest, and leaves loopholes for the super rich to avoid.

Thirdly, selective enforcement of tax laws provides a convenient way to crack down on people the government does not like. That is why the tax code is so complicated, to make it so most higher income people will be have some issue if you check hard enough.