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(Christian Science Monitor)   "America's tax code is fundamentally unfair, complicated, a drag on the economy, and encourages corruption. The entire tax code needs to be thrown out and replaced with one that is simple, fair, and flat."   (csmonitor.com) divider line 56
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289 clicks; posted to Politics » on 14 Apr 2006 at 9:22 PM (8 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2006-04-14 01:10:42 PM

Rick Romero is writing under a penname for The Christian Sciene Monitor now?


home.comcast.net
 
2006-04-14 01:12:56 PM
Whine whine whine. I say making a flat tax would waste $9 trillion a year and 58.67 hours of time per person. See, I can make up numbers too. STFU and pay your taxes. If you didn't want your income to be wasted on $80 billion a month worth of defense spending, ya should've got the vote out for a different government.
 
2006-04-14 01:14:57 PM
Ahhhh the infamous flat tax. It's always out there, ready to pop out and say hello just when you think things can't get any dumber.
 
2006-04-14 01:21:24 PM
Just end withholding, and I will be happy.

When people actualy have to write a check every quarter to pay their taxes, then change will happen.
 
2006-04-14 01:25:41 PM
Flat tax may be crap, but what about national sales tax as opposed to income tax?
 
2006-04-14 01:28:00 PM
ManRay
Many of us do. I am guessing that those who share 7of7's opinion file the 29.95 special at H&R Block. Four times a year I get very annoyed, today I am pissed!
 
2006-04-14 01:28:13 PM
Because everybody needs to buy stuff, but you can get out of paying income tax if you're not making a certain amount. Sales tax, if too heavy, is definitely a regressive taxation method.
 
2006-04-14 01:29:45 PM
All the US needs is a dual system. Citizens get taxed progressively, based on income, with deductions, and or they get taxed on income at 15%. The citizens get to choose.

The same scheme can be adopted for corporations.
 
2006-04-14 01:31:36 PM
How come all these "fair" tax proposals always have the wealthy paying less than they do now?
 
2006-04-14 01:33:50 PM
Flat tax may be crap, but what about national sales tax as opposed to income tax?

Never work, consumer spending would tank as we turned into a nation of savers and even more companies moved offshore to service thier new "international" clients.

How come all these "fair" tax proposals always have the wealthy paying less than they do now?

Because right now they carry an inordinate amount of the tax burden.
 
2006-04-14 01:36:22 PM
Flat tax is all very well and good. However I would suggest anyone advocating it to do the math first, you may be in for a nasty suprise.
 
2006-04-14 01:43:49 PM
The simplest solution is to make election day the day after taxes are due. Change would be remarkably fast.
 
2006-04-14 01:50:02 PM
friendinpa
Because right now they carry an inordinate amount of the tax burden.


And yet the gap between rich and the poor and middle class continues to explode. I have no sympathy whatsoever for whiners who say the rich pay too much in taxes, especially as badly as so many of them fark everyone else over. Take a look at corporate exec salaries over the last 20-25 years and compare their average yearly raise to that of the typical worker. It's a farking joke.

No, they pay a higher percentage and absolutely should continue to do so. Flat taxes are inherently regressive. We've had enough of Dubya Corp heaping tax breaks on the richest Americans.
 
2006-04-14 01:58:46 PM
I for one would like to welccome The CSM to the 80's.
 
2006-04-14 01:59:41 PM
I'm not a fan of the flat tax, or the national sales tax. What if we had a simpler graduated system with deductions:

- Eliminate all deductions.
- Keep the personal and child exemptions, but raise them.
- After you have deducted your personal and/or child exemptions the remaining income is taxed at our current system of variable tax rates with higher rates as you have more income.
- Reduce the variable tax rates a bit.

This would be similar to a flat tax with deductions system (see 'flat tax' on wikipedia) except with a graduated tax rate. So not only is the tax rate much simpler, but you don't have the folks whining that the rich will pay less and the poor more.

You could apply a similar system to businesses taxes.

I haven't read up on any of the arguments for or against the flat tax idea nor am I interested in economics at all, so who knows if this system would work.
 
2006-04-14 02:00:17 PM
Election day is generally held on the first Tuesday of every November (as long as it's not Nov. 1). I say make everyone's tax return due on the preceding Monday.
 
2006-04-14 02:01:48 PM
friendinpa: Because right now they carry an inordinate amount of the tax burden.

Ha. Good one.

We have the highest income disparity since the Gilded Age and the current administration thinks soaking the rich in even more money is the answer.
 
2006-04-14 02:02:21 PM
marginal utility is the appropriate measure of wealth not raw dollars.
 
2006-04-14 02:05:44 PM
National Sales Tax
Flat Tax

Translation:

Poor people are too wealthy and should pay more in taxes so that rich people don't have to.
 
2006-04-14 02:10:22 PM
jimmyhaha: Poor people are too wealthy and should pay more in taxes so that rich people don't have to.

As it stands, rich people can get out of paying a lot of taxes through deductions and other tax incentives. Theoretically, a flat tax would eliminate this. The fact that moonbats wet their pants when you even suggest tax reform doesn't do anything to solve the problem, unless by "reform" you mean "raise taxes." And, of course, most of those advocating raising taxes tend not to pay that much in taxes in the first place and want them raised on folks other than themselves. A flat tax may not solve everything, but the current tax code is a mess to slog through, and God knows I had to do it once.
 
2006-04-14 02:56:27 PM
Write a 6 figure check to the government that equals more than your annual salary because you worked your ass off and had a good year, but not good enough to take any profit, only to cut a fat tax check to Uncle Sam. Then you can talk to me about how the "rich" should pay more taxes.

Most of the people you and the current tax code classify as rich are your neighbors, and are in reality middle class. And before you attack, I do believe we can put together a system that eliminates tax on the poor and is still fair to all taxpayers.
 
2006-04-14 05:19:48 PM
Most of the "anti" flat taxers have obviously never read any of the flat-tax proposals, otherwise they wouldn't be speaking out of their butts about "the poor paying more taxes".

Most flat-tax proposals that I've seen start at incomes above 20K, and some not until 30K.

Regarding the national sales tax, you don't tax necessities (food, etc.). You do tax those cool $100 sneakers, though, and the iPods, and the computers, and the cars and the TV's, and all the other things that the "poor" people in America spend their money on.

As I said in another thread, based on a paper I did in college (based on mid-90's figures), a flat tax of 7.5% combined with a 7% national sales tax would have doubled government revenue from all sources (income/excise taxes, fees, fines, etc., except Social Security/Medicare withholdings). Even if you started the tax level at $30K (for individuals, would probably need to be a bit higher for corporations) of income, tax revenue will rise significantly.

Plus, the government would save billions each year by being able to do away with the IRS, the economy would save billions in compliance costs and we'd all be better off.
 
2006-04-14 06:43:53 PM
Portions of this article were gleaned from the following:

www.dontmissyourlife.com
 
2006-04-14 06:49:00 PM
The entire tax code needs to be thrown out and replaced with one that allows the rich to pay even less while further pulling what is left of the middle class back down to poverty where they belong.

/fixed that for ya
 
2006-04-14 09:00:59 PM
friendinpa: Flat tax may be crap, but what about national sales tax as opposed to income tax?

Never work, consumer spending would tank as we turned into a nation of savers and even more companies moved offshore to service thier new "international" clients.


Just out of curiosity, how often do you pop over to DE to avoid the PA sales tax?
 
2006-04-14 09:48:23 PM
"The entire tax code needs to be thrown out and replaced with one that allows the rich to pay even less while further pulling what is left of the middle class back down to poverty where they belong."

WTF do you mean, "even less"? The average person that makes between $50k and $100k a year has an effective federal tax rate of 9%. In comparison, the average person making $1M to $10M a year has an effective 26% federal tax rate. This includes a lot of factors- for example, it counts capital gains as part of income, and then includes the lower tax rates on capital gains.

The fact is, the wealthy pay at least as much as their "fair share". Probably a lot more.

And for those that didnt catch it, the author of the op-ed was Dick Armey, a former congressman and longtime proponent of flat taxation.
 
2006-04-14 09:51:36 PM
"We have the highest income disparity since the Gilded Age"

I'd be interested to see that research from a reputable source.
 
2006-04-14 10:03:52 PM
A national sales tax would not work because they are fundamentally regressive in nature.

A flat income tax can be regressive too though, unless it calculates taxable income based on an income earner's disposable income.

The flat tax after X dollars of earned income is coming closer to a progressive tax as long as it A) calculates all income earned (including property sales, interest earned, and stock dividends) and B) X is adjusted annually with Cost of Living Adjustments
 
2006-04-14 10:07:34 PM
Hi there.

Do you know how to shelter income such that it never shows up as taxable income? I do.

/flat tax is a sham
//die in a fire or stfu
 
2006-04-14 10:08:13 PM
"The flat tax after X dollars of earned income is coming closer to a progressive tax as long as it A) calculates all income earned (including property sales, interest earned, and stock dividends) and B) X is adjusted annually with Cost of Living Adjustments"

a flat tax with personal exemptions, as it is called, is the only type of flat tax that a major political figure (including Congressman Dick Armey) has ever proposed.

And why should income include things like interest, stock dividends, or other capital gains amounts? Under a flat tax, those companies would already be paying the rate on all profits. For example, say we had a 20% flat tax. Corporations would be paying that on profits before they sent them to shareholders in the form of dividends. Why should shareholders have to pay the 20% again? We want to be encouraging people to invest.
 
2006-04-14 10:11:45 PM
tuna hp The wealthy pay a higher percentage because progressive taxation is designed to tax a person's disposable income. Wealthy people have a greater amount of disposable income.
 
2006-04-14 10:14:18 PM
Code_Archeologist: A national sales tax would not work because they are fundamentally regressive in nature.

Arrrgh, stop saying this. No tax is "fundamentally regressive in nature." Any tax can be designed to be regressive or progressive - you can make an income tax that is regressive, or a sales tax which is progressive. If you actually read any of the flat-tax proposals, or this thread, you would know that every major proponent of a sales tax in this country has proferred a progressive sales tax - one that exempts basic commodities, and has an automatic fixed-rate refund. Some of the proposals would end up paying the poorer levels of society and are fundamentally more progressive than our current income tax, which includes a hell of a lot of exemptions and deductions only used (and indeed usable) by the very wealthy.

Or, hell, if your more moved by emotion than logic, consider this: A sales tax would tax Paris Hilton, something our income tax does not do.
 
2006-04-14 10:15:54 PM
Code_Archeologist: The wealthy pay a higher percentage because progressive taxation is designed to tax a person's disposable income. Wealthy people have a greater amount of disposable income.

The income tax has to estimate a person's disposable income. A sales tax can be targeted so that it only hits money actually disposed of.
 
2006-04-14 10:21:25 PM
"tuna hp The wealthy pay a higher percentage because progressive taxation is designed to tax a person's disposable income. Wealthy people have a greater amount of disposable income."

First of all, the dictionary definition of 'disposable income' is 'income minus taxes', so your statement doesn't really make sense.

But I think I know what you're getting at- the idea that each additional dollar that a person has as income is individually worth less to that person. Even if this were true, what justification is this to tax the wealthier more? The wealthy are either going to spend or invest with their money, and either way it expands the economy, creates new jobs, and increases demand for labor, helping out everyone.
 
2006-04-14 10:22:03 PM
Fair Tax
 
2006-04-14 10:26:42 PM
tuna hp
Interest earned through loans counts as earned income, just because it is money which might be used for investment does not make it any less of a source of income when it is paid backm with interest.

dividends are similar to earned interest from a loan, but are earned interest from a property. It does not matter if the "money" was already taxed through the taxation of profits of a company, the fact that the company is choosing to "pay" their stock holders to hold on to their stock to keep the value of their stock price inflated places that money back into the income category.
 
2006-04-14 10:30:24 PM
Sloth_DC Or, hell, if your more moved by emotion than logic, consider this: A sales tax would tax Paris Hilton, something our income tax does not do.

If a sales tax would keep Paris Hilton from appearing on my TV I would back it 100%
 
2006-04-14 10:31:04 PM
It isn't an either/or situation. The tax code can be simplified without moving to the flat tax, which, depending on which version you use, either screws the poor or the middle class or both.

A better solution is to eliminate most of the deductions and penalties currently on the books, and start afresh. Keep donations to charities not under your direct or de facto control tax-deductible. Create a more granular income tax system for those with annual incomes of $1 million or more. Keep capital gains tax, but only for portfolios in excess of several million dollars. Don't reimburse for state sales and income tax; it's just more paperwork and more headaches. Lower taxes for the poor and middle class; keep taxes for the upper class steady or slightly higher. Tax code simplification without removing the inherent virtue of a progressive tax system (they who profit most from our system should support it most) will save everyone money.
 
2006-04-14 10:38:08 PM
tuna hp: First of all, the dictionary definition of 'disposable income' is 'income minus taxes', so your statement doesn't really make sense.

Depends on which dictionary you use. The statement makes perfect sense when you consider disposable income as "income that you can afford to spend but don't have to in order to maintain a basic standard of living," which is how pretty much everyone but you uses the term.

But I think I know what you're getting at- the idea that each additional dollar that a person has as income is individually worth less to that person. Even if this were true, what justification is this to tax the wealthier more? The wealthy are either going to spend or invest with their money, and either way it expands the economy, creates new jobs, and increases demand for labor, helping out everyone.

They'll either spend, invest, or hoard. Money stowed away in bonds, CDs, or Swiss bank accounts does not contribute substantially to the economy except as a trickle effect over the long term... a trickle effect which is far outweighed by the multiplier effect of having that money in circulation. To paraphrase Ted Turner, what the hell are you going to do with more than $200 million? (maybe $400 million in today's money) If you have that much money coming in all the time, a slight increase in your taxes is not going to significantly change your buying patterns; at best, it'll reduce the amount of money you leave to your already insanely wealthy kids, or the stuff you hoard in your offshore bank. Hell, even Bill Gates can't figure out what to do with most of his money.
 
2006-04-14 10:38:42 PM
Sloth_DC
The income tax has to estimate a person's disposable income. A sales tax can be targeted so that it only hits money actually disposed of.

My definition of disposable income is the money a person earns above and beyond what they need to survive. I understand that people have devised means to have a sales tax which only taxes that which is beyond what a person needs to survive... but all of them seem to be overly complex and prone to abuse.
 
2006-04-14 10:40:51 PM
"Interest earned through loans counts as earned income, just because it is money which might be used for investment does not make it any less of a source of income when it is paid backm with interest."

Yeah, maybe compounding interest should be taxed as income.

"dividends are similar to earned interest from a loan, but are earned interest from a property. It does not matter if the "money" was already taxed through the taxation of profits of a company, the fact that the company is choosing to "pay" their stock holders to hold on to their stock to keep the value of their stock price inflated places that money back into the income category."

This kind of demonstrates a twisted misunderstanding of what a dividend is. A dividend is just a company directly paying its shareholders part of its profits instead of pocketing it all. For example, companies that dont have any growth left to do will most commonly use dividends because they have nowhere to reinvest profits. Not only do dividends not "inflate" stock prices, but if you look at shares of a stock directly before and after a dividend payment, you should see the market price of the share reduced by exactly the dividend amount. For example, if a company is paying out a $5/share dividend, you should see the stock price go down $5.
 
2006-04-14 10:46:11 PM
"which is how pretty much everyone but you uses the term."

http://dictionary.reference.com/search?q=disposable%20income

or not. you dont have to be such a douche about being an ignoramus.

"Money stowed away in bonds, CDs, or Swiss bank accounts does not contribute substantially to the economy except as a trickle effect over the long term... a trickle effect which is far outweighed by the multiplier effect of having that money in circulation."

Except that money in bank accounts IS IN CIRCULATION. Banks only hold 10% or so in reserve. The rest is loaned out, which allows businesses to make economic investments.
 
2006-04-14 10:48:53 PM
captainktainer: A better solution is to eliminate most of the deductions and penalties currently on the books, and start afresh.

Reagan did that about 20 years ago - it didn't take long for Bush, Clinton, and Bush to add back just as many. Just sayin'
 
2006-04-14 10:51:24 PM
Code_Archeologist: If a sales tax would keep Paris Hilton from appearing on my TV I would back it 100%

Don't you have an off-switch or channel-changer or something? I don't have a TV, so I'm not 100% sure about this, but I'd assume that's how it works...

My definition of disposable income is the money a person earns above and beyond what they need to survive. I understand that people have devised means to have a sales tax which only taxes that which is beyond what a person needs to survive... but all of them seem to be overly complex and prone to abuse.

How complex is it to say that food, shelter, and medical supplies aren't taxed, and everyone gets a $X000 refund at the end of the year?
 
2006-04-14 10:53:32 PM
Sloth_DC Reagan did that about 20 years ago - it didn't take long for Bush, Clinton, and Bush to add back just as many. Just sayin'

Yep... you just have to remember what tax bracket the people who populate the halls of Congress tend to reside in... and it all becomes clear as to why those loop holes keep coming back.
 
2006-04-14 11:03:02 PM
Sloth_DC How complex is it to say that food, shelter, and medical supplies aren't taxed, and everyone gets a $X000 refund at the end of the year?

For you and I it is easy to decide what is food, shelter and medicine; but we are reasonable, honorable people who are not out to game the system.

But, there are lots of people out there who will find ways to classify their yacht as "shelter", their 3 pack a day habit as medicine, and alpacas for their ranch in Wyoming as food. We can try to say that it could never happen, but remember that Catsup used to be a vegetable not long ago; government classifications can take some very strange turns in order to appeal to the desires of those with money and power.
 
2006-04-14 11:11:51 PM
tuna hp: Except that money in bank accounts IS IN CIRCULATION. Banks only hold 10% or so in reserve. The rest is loaned out, which allows businesses to make economic investments.

That's true, if it's invested in domestic banks (and even then, modern-day banks don't even come close to the reserve limit on their deposits, making further deposits economically inefficient). Banks incorporated for the purpose of tax shelters often don't loan out much of the money if at all. The money usually goes right back to the investor or his heirs without having circulated in the global economy for very long- after all, if it's circulating and you want to remove all of your deposits, it's problematic if your personal bank has outstanding loans.

Sloth_DC: Reagan did that about 20 years ago - it didn't take long for Bush, Clinton, and Bush to add back just as many. Just sayin'

Reagan's tax code reforms were, in the grand scheme of things, fairly modest compared to what I propose. But yes, the accumulated weight of twenty years of politicians dicking around with special business interests has mucked things up again. Thomas Jefferson wrote "The tree of liberty must be refreshed from time to time with the blood of patriots;" I say that the tax code needs rejuvenation every so often with the anguished screams of tax accountants.
 
2006-04-14 11:38:24 PM
Remember, if you do not cut government spending, any tax system must bring in the same amount of revenue. As such, any reduction in taxes your system brings about for one group must be made up by another. Thus, if your remove taxes on "interest, stock dividends, or other capital gains" because you deem them unfair, that means you must raise that revenue through some other form of taxation.
 
2006-04-14 11:43:51 PM
Cathedralmaster: Remember, if you do not cut government spending, any tax system must bring in the same amount of revenue.

Unless, of course, the new tax system costs significantly less to administer than the current system.
 
2006-04-15 12:24:39 AM
That's why I just don't pay them taxes.
 
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