I'm confused. Don't you pay a higher tax rate (percentage of your taxes) the more money you make?
It gets complicated, because different types of income are treated differently.
Limiting the conversation strictly to earned income and income taxes, you're right - the more you make, the higher your effective rate. But when you start tossing the exclusion of unearned income from the social security system, the cap on social security contributions, the separate rate for capital gains, and all the other complexities of our system as a whole you find that the middle class does in fact pay higher rates than the very wealthy.
The rich don't pay the least by any means - that goes to those at the very bottom of the ladder who pay negative effective rates - but they do often pay a lower rate than the middle/upper middle classes who have a relatively high income that is all earned rather than derived from ownership and investments. Warren Buffett raised this point a few years back by pointing out that he pays a much lower effective tax rate than his secretary.
If we taxed by consumption, everyone would be paying their fare share.
People complain about the wealthy not paying taxes. If they truly are very wealthy, chances are they don't work. The only thing that they are taxed on is interest on their investments (well, the interest that they allow the government to see). If they were taxed on consumption (and all those who find ways of cheating on their taxes by taking ridiculous deductions or not at all as in the case of prostitution or drug dealers or name the non-taxable occupation), it would be a much fairer system.
That consumption tax would be in place of our current income tax, not in addition to (read VAT).
Consumption taxes are heavily biased against the working classes who need to spend virtually all of their income on essentials like food and clothing, and still allows the wealthy an "out" by the fact that it only covers goods and services purchased in the United States. For those who can readily afford foreign travel (as well as those of more limited means who live near borders - I can be in Canada in 5 minutes), it encourages making purchases in other countries to avoid US taxation.
Meanwhile, people living paycheck to paycheck see an immediate 20% jump in their cost of living with no accompanying tax cut or pay raise, and we have more people who can't afford to put food on the table or shoes on their kids' feet. The highest effective tax rates are paid by the poorest families, and you discourage the middle classes from consuming, which has the effect of increasing savings rates but also of slowing economic recovery/growth and costing jobs at the low-wage, frivolous-spending establishments that employ most of the working poor.
A flat income tax is the way to go, but it has to be truly flat with an end to the social/economic engineering of special rates for certain income sources and deductions for "preferred" economic behaviours.