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Old 08-21-2017, 09:38 PM
 
Location: Paranoid State
12,685 posts, read 9,432,561 times
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I would go one step farther. We should eliminate the federal income tax and replace it with a federal progressive consumption tax. We could eliminate the IRS.
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Old 08-21-2017, 09:46 PM
Status: "Living the good retired life." (set 28 days ago)
 
Location: Wasilla, AK
5,870 posts, read 3,148,828 times
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When you implement a second tax to offset an existing tax you wind up with two taxes that will both be increased over time. Keep taxes to a minimum and fight increases like hell. Otherwise you'll wind up being taxed to death, as is occurring right now in places like California and Connecticut.
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Old 08-21-2017, 10:06 PM
 
1,027 posts, read 559,669 times
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Quote:
Originally Posted by BugsyPal View Post
IIRC nearly every nation/country or whatever with social security system has payroll taxes. Some may pile on others in order to generate revenue and or plug fiscal holes (deficits), but there you are then.


The idea is simple; those who will benefit (the employed) contribute to their future retirement "pension".


It should also be pointed out that while FICA taxes may be "regressive" to low wage workers, they do benefit vastly more than others at retirement.


As SS is currently configured in this country low wage earnings are weighted a bit heavier (IIRC) when calculating benefits from employment records. Not to mention since the truly "poor" elderly can receive both Medicare (from SS contributions) and Medicaid (general tax revenue funded), in some instances what is being proposed already happens.
BugsyPal, itís been recognized that although employees funding their entire retirement costs would be ideal, itís not feasible. Due to improved medical technology, lifetimes have increased but quality of elderly life as not equally improved.
Apparently, the combined taxes of only employees and employers should not entirely fund employeesí retirements.

Itís proposed that employeesí and employersí FICA payroll taxes fund no more than half of the Social Security Retirement plan, and a general sales tax should fund the remainder. Additionally, itís proposed caps upon employees total annual wages subject to FICA be eliminated.

We agree that beyond Social Security retirement benefits to the retirees and their families, those benefits are also of net benefit to our nationís economic and social wellbeing
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Old 08-21-2017, 10:22 PM
 
1,027 posts, read 559,669 times
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Quote:
Originally Posted by SportyandMisty View Post
I would go one step farther. We should eliminate the federal income tax and replace it with a federal progressive consumption tax. We could eliminate the IRS.
SportyandMisty, a sales tax is a consumption tax. Whatís a progressive consumption tax?
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Old 08-22-2017, 03:07 AM
 
33,046 posts, read 20,720,491 times
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Quote:
Originally Posted by SportyandMisty View Post
I would go one step farther. We should eliminate the federal income tax and replace it with a federal progressive consumption tax. We could eliminate the IRS.

Please explain how a consumption tax is progressive. Taxing rent is inherently regressive.
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Old 08-22-2017, 03:12 AM
 
33,046 posts, read 20,720,491 times
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Quote:
Originally Posted by BugsyPal View Post
IIRC nearly every nation/country or whatever with social security system has payroll taxes. Some may pile on others in order to generate revenue and or plug fiscal holes (deficits), but there you are then.


The idea is simple; those who will benefit (the employed) contribute to their future retirement "pension".


It should also be pointed out that while FICA taxes may be "regressive" to low wage workers, they do benefit vastly more than others at retirement.


As SS is currently configured in this country low wage earnings are weighted a bit heavier (IIRC) when calculating benefits from employment records. Not to mention since the truly "poor" elderly can receive both Medicare (from SS contributions) and Medicaid (general tax revenue funded), in some instances what is being proposed already happens.

: smack::s mack::sm ack:

ONLY applies to those WHO LIVE LONG ENOUGH. Low-wage workers have shorter longevity than higher-income workers. Some people have said that black men get the worst deal from Social Security because their life expectancy is about 65 and many pay in for years without living long enough to get back wheat they paid in.
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Old 08-22-2017, 06:45 AM
 
845 posts, read 360,138 times
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Quote:
Originally Posted by SportyandMisty View Post
I would go one step farther. We should eliminate the federal income tax and replace it with a federal progressive consumption tax. We could eliminate the IRS.
Just like all the states with sales/use taxes that have eliminated their revenue departments and need for litigation to enforce those laws.
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Old 08-22-2017, 07:20 AM
 
Location: Paranoid State
12,685 posts, read 9,432,561 times
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Capital is a key determinant of economic growth, along with labor and technology. Yet, the U.S. tax system systematically penalizes saving, which finances capital formation. The tax penalty on saving could be eliminated by moving to progressive consumption taxation.

One progressive consumption tax is the personal expenditure tax, sometimes called a “consumed income” tax. This tax starts with a framework similar to the individual income tax, but with a crucial modification that strips out the income tax’s saving penalty. Households would report their income on annual tax returns, but would then claim a full deduction for all saving and add back in any dissaving. What’s left would be the household’s before-tax consumption for the year. That consumption amount would be taxed at graduated rates, with higher tax brackets for households with higher consumption. Exemptions and refundable tax credits could be provided to low-consumption households.

Such a system could be made as progressive as you want. At the same time it eliminates the current penalties on savings & would encourage more capital formation which, of course, leads to higher economic growth going forward.
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Old 08-22-2017, 08:19 AM
 
2,953 posts, read 1,391,095 times
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Quote:
Originally Posted by evening sun View Post
So now I am retired & collecting SS, which I paid into all my life, & now you want me to continue to pay, via a sales tax. I think not.
Bravo!

National sales tax - Horrible idea.
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Old 08-22-2017, 08:56 AM
 
1,027 posts, read 559,669 times
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Quote:
Originally Posted by freemkt View Post
Please explain how a consumption tax is progressive. Taxing rent is inherently regressive.
freemkt,
Quote:
Originally Posted by Supposn View Post
LowExpectations, within post #8 I expressed some of my opinions regarding waivers of general sales taxes.

Iím an advocate of waiving sales taxes upon medicines, or food other than that supplied by restaurants, or caterers.
itís difficult to draft legislation the parses ordinary and luxury priced products. For that reason, Iím advocate of fewer such sales tax waivers upon classes of products. But the political reality is that there will be more than I prefer.

Iím aware to the extent that general sales taxes are waived upon sales of products that are more often or in greater quantities consumed by lower income persons, we can to some limited extent transform a sales tax to be effectively more progressive.
But itís difficult to draft regulatory provisions for such products as not to unduly reduce tax revenues.
Travel within reasonable commuting distances on mass transportation is one of the service products that I would prefer to be waived if the legal drafting did not also allow waivers for longer distances or more luxurious transportation.

Difficulty of legal drafting is much less problematic for products or services that can be linked to individualsí primary residences. Itís feasible to waive a capped amount upon rents, specific utilities, and other services linked to such residences; those capped amounts should be annually cost-of-living adjusted.
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