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If I make $90,000 a year, that means I'm always guaranteed to pay $9,000 under the OP's proposed flat tax system. THAT is regressive, because it means no matter what hardships I might have endured, or how my life might have changed, I'm always going to get nailed that $9,000. It also means I have to continue filling out tax forms every year, and I have to keep paying for IRS drones.
Compare that to Fair Tax, where you pay taxes on the goods and services YOU CHOOSE to buy. You keep saying "but people won't spend!!" You don't get it. People will never stop spending. They may curb spending, but spending can't stop.
People need clothes. People need food. People need gas. People want movies. People want games. People want cars. People want boats. People need homes. People want/need phones. The list goes on and on.
A sales tax won't work. As a retailer, I'm on the front lines. A national sales tax will hurt us. If you don't want to pay taxes....don't make purchases. Many businesses are hanging buy a thread and I can't see giving people a reason to not shop. I think of people like my father. He's retired and wealthy. But he will drive his cars into the ground before he would pay 20% tax on a new vehicle. Which is one of the reasons he's wealthy Our economy doesn't work that way. I just don't see it working.
To the OP, I like it, but I have no idea if it will cover the expenses of our country.
I am in agreement with a lot of the posts on this thread, but I do support taxing capital gains, especially on investment income.
Think about it, when the Bush tax cuts abolished capital gains tax, CEO bonus pay shifted to favor "stock options" heavily. They could then avoid paying taxes, no capital gains tax.
We have to look at income as income, regardless of the source.
I think deferring taxation till the investment is liquidated is fine, but income is income.
As for a progressive tax system, it is the only just way to go.
I mean lets face it, the millions of dollars the CEO of McDonald's is making, is done so on the backs of Americans making largely minimum wage with no benefits to speak of.
Should we as a society allow this, hell no, it just aint right. but we all know that if we don't tax that CEO and help those he is making his money on, it won't happen and our sons and daughters will be stuck in a never ending cycle of poverty.
While not so much here, I have heard people talk about the "redistribution of wealth" in this country as if it is a bad thing.
Less than 1% of this nations populous controls 95% of the nation money...
Do you think they are going to give it away or invest it in their workers? Hell no they won't, they're greedy. If they were not greedy, the guy serving you at McDonald's might actually care about something more than a paycheck and they wouldn't worry about how they were going to pay for school.
Even the so called "social responsibility" movement that Starbucks started is really just a scheme. It plays upon our desire to be good citizens and encourages us to pay $5.00 for a cup of coffee that is no better than the local brand at $.05 a cup.
The Republican idea of "trickle down economics" that was made popular by Ronald Reagan is a hoax. If you allow people at the top to keep more money, it doesn't trickle down, it is stocked away for their children. It will never see the lower class, it will go to the multimillion dollar hedge fund managers in a big ponzi scheme making profits on us.
To the OP, I like it, but I have no idea if it will cover the expenses of our country.
I am in agreement with a lot of the posts on this thread, but I do support taxing capital gains, especially on investment income.
Think about it, when the Bush tax cuts abolished capital gains tax, CEO bonus pay shifted to favor "stock options" heavily. They could then avoid paying taxes, no capital gains tax.
We have to look at income as income, regardless of the source.
I think deferring taxation till the investment is liquidated is fine, but income is income.
As for a progressive tax system, it is the only just way to go.
I mean lets face it, the millions of dollars the CEO of McDonald's is making, is done so on the backs of Americans making largely minimum wage with no benefits to speak of.
Should we as a society allow this, hell no, it just aint right. but we all know that if we don't tax that CEO and help those he is making his money on, it won't happen and our sons and daughters will be stuck in a never ending cycle of poverty.
While not so much here, I have heard people talk about the "redistribution of wealth" in this country as if it is a bad thing.
Less than 1% of this nations populous controls 95% of the nation money...
Do you think they are going to give it away or invest it in their workers? Hell no they won't, they're greedy. If they were not greedy, the guy serving you at McDonald's might actually care about something more than a paycheck and they wouldn't worry about how they were going to pay for school.
Even the so called "social responsibility" movement that Starbucks started is really just a scheme. It plays upon our desire to be good citizens and encourages us to pay $5.00 for a cup of coffee that is no better than the local brand at $.05 a cup.
The Republican idea of "trickle down economics" that was made popular by Ronald Reagan is a hoax. If you allow people at the top to keep more money, it doesn't trickle down, it is stocked away for their children. It will never see the lower class, it will go to the multimillion dollar hedge fund managers in a big ponzi scheme making profits on us.
FYI, Bush eliminated the capital gains tax only on the two lowest income brackets, i.e. the small-time investors who need the tax break the most. The government places a lower tax rate on capital gains on assets held longer for a year because they want to encourage investment within our economy. If you hold the asset for less than a year, then it gets taxed at the same rate as regular income.
I'm all for everyone paying their fair share of taxes, but strongly against redistribution of wealth. I'd rather have the opportunity to achieve my own success than have someone else's money handed out to me.
I'm all for everyone paying their fair share of taxes, but strongly against redistribution of wealth. I'd rather have the opportunity to achieve my own success than have someone else's money handed out to me.
How can you avoid redistribution of wealth? It is natural, except for the direction it can take. There is only finite wealth to go around.
A lot of people assume that they can work harder and get rich. A lot of people work a lot harder than the rich. And no matter how hard you work, if policies help those who have more (regression), the divide will only increase.
I don't understand why people are opposed to a flat tax income system.
0-100K =10% income tax (still keep the earned income tax credit for poor)
100K-250K=15% income tax
$250-500K=20%
500K-1 mil =25%
>1 mil =30%
1. Index the taxes for inflation
2. Eliminate all deductions (housing, retirement, business losses/stock losses etc).
3. Eliminate capital gains taxes (obviously don't allow the hedge fund manages to pay only 15% tax on their income like they have been doing).
4. Eliminate all estate taxes
This seems like the fairest way to generate income. The Dems would be happy since the rich can't circumvent taxes by shielding money in trusts etc.
The rich are happy because their capital gains are taxed free (since they can't deduct losses either). Your retirement funds would be tax free (since it's all considered after tax money anyways)
The middle class should be happy since they won't be paying more than 10% income taxes. This will offset most losses they would incur by losing the property tax deduction. Most of all, this all but eliminates the AMT trap many middle class citizens in high property tax states/high state income tax like New Jersey, NY, California face
The poor still get shielded because the earned income tax credit would still be around. Most would have very little tax liability.
People have to realize, most "rich or uber rich" people barely pay more than 10-15% "effective tax rates". This would make the rich more accountable for their "fair share." But they would still be happy since they wouldn't be taxed on investment gains.
I believe you would generate even more tax revenue this way. Everyone sees where their true tax bracket it.
Would the VAT that was suggested by one of our better known economists qualify as a flat tax?
I am for a flat tax but only in the line of the one that is called the Fair Tax buy its supporters. Throw away all those other taxes, especially the income tax.
A sales tax won't work. As a retailer, I'm on the front lines. A national sales tax will hurt us...
Not only that, online sales will have to be included as well as tariffs on imports. On top of that, many states tax on food while others don't. If national sales tax policy were adopted, food will be taxed even in states where it currently isn't. In other words, federal taxation could start determining (or undermining) local taxation laws.
First thing is to repeal ALL of the existing tax code including all of the current special tax incentives and back door deals. Replace this mountain of paper with a tax system that can be, and I have, explained on one sheet of paper. The outline is here:
The top 15% of income recipients should be subject to a steep progressive income tax on all income from all sources. This includes inheritance and capital gains. As corporations are considered individuals they face the same tax scales on retained profits. This tax is adjusted to pay current expenses and a portion of the debt until it is eliminated.
Social Security taxes include everyone with no upper limit on income subject to taxation. the amount collected is limited to current expenses without any regressive "TRUST FUND" scams.
Imports should be taxed to eliminate and differential created by slave wages, lax environmental standards and government subsidy.
I believe my suggestions would revitalize our economy as the vast majority of our people would have enough income to save, invest and spend on domestically produced products with the effective elimination of unemployment and most poverty.
That's not a flat tax. It's a simplified version of the progressive income tax. A flat tax is, you are taxed, say, 17%, regardless of whether you make $30k or $300k. I am against the flat tax because, if you're making $300k, you have a greater capacity to pay taxes than if you are making $30k, as your system implies.
Indeed. Not only that, the proponents of Forbes and Armey flat tax proposals are missing a key ingredient with their unconditional faith in right wing, "conservative" politics. That these policies stand to benefit the rich. The more you make, the more you can distance yourself from the peasants.
To put that in perspective, the effective tax rates in 2005 as a result of Bush's tax cuts was as follows (Source: Tax Policy Center):
$30K-$40K: 13.6%
$40K-$50K: 15.8%
$50K-$75K: 17.4%
$75K-$100K: 19%
$100K and above: 21-22%
So, technically, not only is the effective tax rate is almost flat from about 75K onwards, under Forbes plan, those making less than 50K will actually pay more in taxes (which I assume is the biggest percentage of tax payers today), while those making more than 75K see tax cuts.
There is no free lunch, as many here seem to believe. Someone's got to pay for it. They just want the less affluent to take the burden from the affluent.
FYI, Bush eliminated the capital gains tax only on the two lowest income brackets, i.e. the small-time investors who need the tax break the most. The government places a lower tax rate on capital gains on assets held longer for a year because they want to encourage investment within our economy. If you hold the asset for less than a year, then it gets taxed at the same rate as regular income.
I'm all for everyone paying their fair share of taxes, but strongly against redistribution of wealth. I'd rather have the opportunity to achieve my own success than have someone else's money handed out to me.
It's not really a true redistribution of wealth. Our progressive tax system puts a larger burden on income in excess of certain defined limits. It does this to provide service to lower income people that would otherwise not be available to them.
For instance, very few of Walmart's employee's get employer paid health benefits. Well when you look at upper management of Walmart, they get health insurance benefits, but the vast majority of the average Walmart employee's, are on public funded health care.
If the executives don't like paying a higher tax on their substantially higher incomes, take a pay cut and give your workers better service.
But you and I both know, this will not happen, and that is the basis of the progressive tax system. Which incidentally, most people actually do not understand how it works.
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Our economy doesn't work that way. I just don't see it working.
