Q26

[windyanize7610]

I tend to get this type of questions wrong all the time. I chose E over B during practice.

I now see why B is correct, but still don't see why E is wrong.

A is not mentioned in passage B at all, so eliminated

C, passage B considers flat tax system to be problematic in theory as well, so eliminated

D is rejected by passage A

For answer E, isn't passage B, at L50 to L53 says "why go suddenly from one extreme to the other?" Nowhere in passage B says anything about exempt amount, while passage A does (L18).

Any help??

[ohthatpatrick]

Since the two passages were largely adversarial (psg A was pro-flat tax and psg B sounded more anti-flat tax), we could certainly anticipate a possible answer that would relate to a good/bad aspect of flat taxes.

But, ultimately, we just have to prove our answer w/ line references from each passage.

(A) Both authors acknowledge that a flat tax system CAN be progressive, in the sense that you can set a threshold income, below which you wouldn't have to pay any tax. Psg. B brings this up in line 48-50.

(B) Psg A says this is NOT true (line 26-29), while Psg B says that this IS true (line 56).

(C) Psg A definitely thinks they CAN be put into practice (line 5-8). Psg B doesn't dispute this.

(D) They would agree. This is the definition of a graduated progressive system: the highest income earners pay the highest rate.

(E) This is an extreme claim, so it's unlikely that either author would agree to this.

Since we know, from (A), that both authors discussed a minimum threshold, under which you would pay NO tax, we know that both authors would reject (E). If someone makes only $10,000 / year, for example, both authors would seemingly endorse a system in which that earner pays no tax.

Psg A, in line 17-19, explains that you'd only pay the tax rate "on all income above" the threshold.

Hope this helps.

[asafezrati]

Regarding answer choice D -
Firstly, I don't get it. "a higher rate on..." - higher in comparison to what?

If it's higher in comparison to the flat tax I don't understand how they would agree on D.
Passage A says that due to fancy tax tricks the high-incompe people pay the same amount as they would have paid under the flat tax. This means the same absolute dollars as a part of the same absolute income = the same rate.
On the other hand passage B explicitly states in lines 55-56 that the rich people are going to pay less under the flat tax (= they will pay more under a progressive system).

Or does the answer choice mean "higher than the other groups"?

[ohthatpatrick]

Wow, I definitely misread (D) the first time. My explanation is not quite right.

Good question with the "higher than what"?

Even though the whole context of the dual passage is graduated vs. flat tax, this answer choice seems to be saying

WITHIN A GRADUATED PROGRESSIVE SYSTEM
higher income taxpayers vs. lower income taxpayers

This answer choice is basically saying that in graduated systems, the higher your income level, the higher a rate you're paying on your entire earnings.

Psg B would disagree with this. A rich person does not pay an identical rate on all her earnings. She pays the lowest rate on the first layer of earnings, the middle rate on the next layer, and the highest rate on the highest layer.

Psg A never got into the nitty-gritty of how graduated systems work in this regard, so we would basically be stuck with a "No comment" from psg. A.

Lines 13-16 seem like they are the closest match, but they're talking about high earners paying a larger PROPORTION of their entire incomes in tax. Psg A never says that high earners pay the SAME RATE on their entire income.

Let's say you get taxed
20% - 0 - $50k
30% - $50 - 100k

Someone who makes $50k a year would pay 20% of their income in tax.

Someone who makes $100k a year would pay 25% of their income in tax (the weighted average of the half of their income subject to 20% and the half of their income subject to the 30%).

So both authors would likely agree that (D) is false. Graduated systems don't charge the same rate on the entire income.

But in reality, we have no direct comment from Psg A on the matter.

[RaymondP528]

I still don't understand why C is wrong. The authors do disagree on whether "flat tax systems are fine in theory (P) but cannot be put into practice (Q)". Passage A says P is right and Q is wrong. Passage B says P is wrong and Q is also wrong. They may both agree that the truth value of said statement is false--but they would still disagree about the truth value of P, which means that they disagree on that statement.