# My Tax Proposal

I've been reading some of Milton Friedman's Capitalism And Freedom and, although I disagree with a lot of what he says, he does have a few good points. In reading some of his suggestions for a good system of taxation, I have gotten a few ideas and come up with a system of taxation that I like:

\begin{equation*} T = (I - C_{1}) * C_{2} \end{equation*}

It's a very simple system, $$T$$ is how much money you have to pay in taxes annually, $$I$$ is your annual income, $$C_{1}$$ and $$C_{2}$$ are constants to be determined by someone more understanding of economics than myself. In essence, you can earn up to $$C_{1}$$ without being taxed and then anything beyond that is taxed at rate $$C_{2}$$. Key issues with this system are that is must be taken as it is exactly and there must be no exceptions made; it does not matter where your income derives from, how many children you have or anything else, just your annual income.

One could also consider a different approach to the under $$C_{1}$$ realm and use a negative tax scheme where individuals are paid a fraction of the amount they need to reach $$C_{1}$$. For example, take $$C_{1}$$ to be $50,000 and $$C_{2}$$ to be 50%: individuals making more than$50,000 are taxed half of what they make beyond $50,000 and individuals making less than$50,000 are given half of the difference between their income and $50,000. I would say that the second interpretation is a more "liberal" or "socialist" approach and can be taken or left based on that fact alone but that the first interpretation would make for a very good tax scheme that would be well liked by quite a few people. Personally, I'd like a $$C_{1}$$ of$200,000 and a $$C_{2}$$ of 50% but that's just me.