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The flat tax represents, not punishment, but fairness. Everyone's income is taxed in the same proportion.
That's a naive view of equality, one that fails to consider the power structures in society that benefit the wealthy at the expense of the rest. Wealth can buy influence and control over others to manipulate transactions so that the market is not simply a barter economy.
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By the way, the biblical tithe is a flat tax. Are you saying the God of the bible is about punishing people?
According to some, most definitely. By the way, why don't we talk Zeus or Odin in the context of political economy? I fail to see how the Bible is relevent, since I put it in the same category as mythology.
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Deductions represent politicians using tax dollars to bribe people to do or withhold from doing certain activities. That's not the purpose of taxation--which is merely to raise the revenue necessary to carry out those responsibilites that government has under the Constitution.
The complexity of reality is beyond you, so you resort to these sorts of slogans you have heard. Educated, experienced people do not fall prey to this kind of simplistic thinking.
You don't want to open that can of worms. If there is a tax system that "punishes" people it is the progressive income tax.
What kind of punishment is it that I can't feel the pinch of, compared to someone making a fraction of what I do? Do you seriously believe you've it better, with lower burden, if you made less and qualified as one of those making less?
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To answer your question, all income, whether produced by labor or investment, should be taxed equally. And that applies to corporate income. Nobody should be getting special treatment. As for deductions, there should be none. Deductions represent politicians using tax dollars to bribe people to do or withhold from doing certain activities. That's not the purpose of taxation--which is merely to raise the revenue necessary to carry out those responsibilites that government has under the Constitution.
Now let us talk about repercussions. And your take on how this idea benefits a capitalistic society and manages welfare of the nation as a whole.
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Originally Posted by JimMe
By the way, the biblical tithe is a flat tax. Are you saying the God of the bible is about punishing people?
Oh, I'd missed this beauty of an argument. You must be talking about the kind of God, who also trapped humanity into committing sin so he can hate and punish them for eternity.
The Bible also speaks about giving it all to the poor and the inability to do that disqualifies one from being true.
The flat tax represents, not punishment, but fairness.
No, a Flat Tax is fundamentally unfair.
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Originally Posted by JimMe
Everyone's income is taxed in the same proportion.
That's fair if and only if everyone enjoys the exact same standard of living and purchasing power parity.
In very small post-Industrialized Nations like Luxembourg (pop. 497,000) and Norway (4.8 Million), Denmark (5.6 Million), Sweden (9 Million), Finland (5 Million), Belgium (10 Million), the Netherlands (16 Million) and others were the standard of living and purchasing power parity are uniform throughout the entire country, a Flat Tax is fair.
In small countries, especially those that are still industrializing, like Greece (pop 11 Million) and Romania (23 Million) where there are huge disparities in the standard of living and purchasing power parity, a Flat Tax is unfair.
The US does not have a uniform standard of living or purchasing power parity. Some people in the US make only the federal minimum wage, yet they live a Middle Class life-style because the cost of living is less and also their dollar buys more. Other people in the US earn the federal minimum wage, yet it doesn't even provide enough to pay rent and electric for one month.
That is easily proven here:
Fred lives in Ohio, earns $24,000 and pays $450/month for rent including electricity, cooking gas and heat, $189/month new car payment, $60/month for full coverage car insurance with $0 on Collision/Comprehensive, eats extremely well on $200/month, pays 5.5% sales tax.
Fred has a disposable income of $1,101 per month.
Frank lives in California, earns $36,000 a pays $900/month, plus averages $310 per month in electricity, cooking gas and heat, $229/month for the exact same car Fred owns, because California requires special emission controls, $250/month for full coverage car insurance with a $500 deductible on Collision/Comprehensive, pays $240/month for the same food Fred does and pays 7.5% sales tax.
Frank has a disposable income of $1,071 per month.
Fred makes $12,000 less than Frank, but has an higher disposable income of $1,101 per month.
Under Perry's Flat Tax Plan which allows for a personal deduction
Frank makes 33.3% more than Fred yet Frank pays 52% more.
How is that fair?
Fred has a pre-tax disposable income of $1,101 per month, but after tax it would be $1,101 - $191 per month = $910 per month
Frank has a pre-tax disposable income of $1,071 per month, but after tax it would be $1,071 - $391 = $680 per month.
Again, how is that fair? Frank only makes $12,000 more than Fred, but Frank ends up with almost $300/month less in disposable income. How is that fair?
Sure, Frank makes more money, but his life-style and standard of living are worse than Fred who makes less money.
Does that make sense? Earn more and have a lower standard of living?
Again, if the cost of living and purchasing power were uniform through the entire United States, then a Flat Tax would be fair, and it would make sense.
That's a naive view of equality, one that fails to consider the power structures in society that benefit the wealthy at the expense of the rest. Wealth can buy influence and control over others to manipulate transactions so that the market is not simply a barter economy.
According to some, most definitely. By the way, why don't we talk Zeus or Odin in the context of political economy? I fail to see how the Bible is relevent, since I put it in the same category as mythology.
The complexity of reality is beyond you, so you resort to these sorts of slogans you have heard. Educated, experienced people do not fall prey to this kind of simplistic thinking.
That's the point, isn't it? An inexplicable tax code is a boon to the power brokers. They can manipulate it to their advantage. By contrast, a flat tax is not subject to the manipulations of the monied interests in cahoots with corrupt politicians.
I wasn't aware that Zeus or Odin had a tax code.
Simplistic thinking? Maybe it takes simplistic thinking to recognize just how manipulative our government is through the tax code.
That's fair if and only if everyone enjoys the exact same standard of living and purchasing power parity.
In very small post-Industrialized Nations like Luxembourg (pop. 497,000) and Norway (4.8 Million), Denmark (5.6 Million), Sweden (9 Million), Finland (5 Million), Belgium (10 Million), the Netherlands (16 Million) and others were the standard of living and purchasing power parity are uniform throughout the entire country, a Flat Tax is fair.
In small countries, especially those that are still industrializing, like Greece (pop 11 Million) and Romania (23 Million) where there are huge disparities in the standard of living and purchasing power parity, a Flat Tax is unfair.
The US does not have a uniform standard of living or purchasing power parity. Some people in the US make only the federal minimum wage, yet they live a Middle Class life-style because the cost of living is less and also their dollar buys more. Other people in the US earn the federal minimum wage, yet it doesn't even provide enough to pay rent and electric for one month.
That is easily proven here:
Fred lives in Ohio, earns $24,000 and pays $450/month for rent including electricity, cooking gas and heat, $189/month new car payment, $60/month for full coverage car insurance with $0 on Collision/Comprehensive, eats extremely well on $200/month, pays 5.5% sales tax.
Fred has a disposable income of $1,101 per month.
Frank lives in California, earns $36,000 a pays $900/month, plus averages $310 per month in electricity, cooking gas and heat, $229/month for the exact same car Fred owns, because California requires special emission controls, $250/month for full coverage car insurance with a $500 deductible on Collision/Comprehensive, pays $240/month for the same food Fred does and pays 7.5% sales tax.
Frank has a disposable income of $1,071 per month.
Fred makes $12,000 less than Frank, but has an higher disposable income of $1,101 per month.
Under Perry's Flat Tax Plan which allows for a personal deduction
Frank makes 33.3% more than Fred yet Frank pays 52% more.
How is that fair?
Fred has a pre-tax disposable income of $1,101 per month, but after tax it would be $1,101 - $191 per month = $910 per month
Frank has a pre-tax disposable income of $1,071 per month, but after tax it would be $1,071 - $391 = $680 per month.
Again, how is that fair? Frank only makes $12,000 more than Fred, but Frank ends up with almost $300/month less in disposable income. How is that fair?
Sure, Frank makes more money, but his life-style and standard of living are worse than Fred who makes less money.
Does that make sense? Earn more and have a lower standard of living?
Again, if the cost of living and purchasing power were uniform through the entire United States, then a Flat Tax would be fair, and it would make sense.
Where in the Constitution is the federal government empowered to equalize living standards?
I wonder why I am not wealthy since the whole GOP base is wealthy, according to you. Maybe many of us who are GOP and not wealthy haven't been able to see through your thinking.
A progressive tax is the ultimate favor to payoff the Democrat base, the government-dependent class, by ensuring wealth redistribution from the top-down. A flat tax only ensures equal protection under the law irregardless of one's income or wealth. After all, a rich person has the same private property rights as a middle-class or poor person. Wealth or income equality does not justify theft.
someday i hope to be a billionaire and chum with other billionaires
except I have a more insidious plan in mind, i want to have more land than Ted Turner, the Boswell corporation, etc
take over food production pretty much and then charge what i like.
apples to oranges? yeah but who cares.
accumulation of "anything" into the hands of the extreme few can present societal problems.
c'est la vie. i think my plan is great...now i just need some money
There was a time when I did not worry about flat tax schemes. They are so absolutely terrible for the majority of people that I figured they would not be tolerated. Any party that raised taxes on virtually everyone who is not already very wealthy to give even more generous tax cuts to the rich would be forced out of office for a generation.
However, I just don't know anymore. In our media saturated world, people just seem incapable of seeing where their interests lie. I can see the Republicans jacking up taxes on everyone so they can lower them on the "job creators" (where the F are the jobs?!?) and then finding some way to blame those darn liberals for the inevitable impoverishment that will result.
What do you all think? Do you think a flat tax scam will ever be enacted into law?
The sales taxes that 50 of our States impose are "flat taxes" (on consumption rather than income). Local governments also add their own sales taxes on top. Soon the federal level will probably add theirs. In NH, we pay property tax to the State in addition to the Local Government, because of the idiotic School Funding decision by a megalomaniac Judge.
At some point, every single type of tax will be levied by the three separate levels of government. And it still won't be nearly enough. It can never be enough--not even if we were suddenly in the most prosperous economy we've ever had. We'd still all be broke at the end of the day, after the "Lions" of government eat every scrap of every "kill," leaving nothing for anyone else.
We already are taxed in a million different ways--pretty much any time money changes hands, any time a period of time passes, any time we buy or own or sell something something. But usually we only have ONE job to give us income. It is financial "death by a thousand cuts."
We have THREE huge levels of government, all grown so large that our economy--which has been shrinking in real, after-inflation terms for the past 20 years--is crushed under the weight of both paying for it all, and complying with the endless flow of new regulations. Small businesses are HUGELY handicapped under this system. Big Business does fine--but an economy ruled by Big Business in collusion with Big Government is a disaster for the lowly working class.
Now we not only have the huge size of government to burden the economy, but they have discovered that they can BORROW without ANY RESTRAINT by simply using the Fed to buy our own debt, while simultaneously keeping the interest rate at zero, and devaluing the dollars we are paid in and have savings/investments in. And now we've racked up over $16 trillion in Federal debt alone, not counting State and Local Government Debt.
Add the size of Government today, and the debt they've racked up, and the working class is doomed. We simply can't pay for such massive government. We no longer have the income. The vast majority of us don't even have a prayer of a secure retirement for ourselves even after working our whole lives, and government couldn't care less if they take everything we have to preserve their power and wealth. Besides, then WE'LL be destitute, and have no choice but to vote for liberal candidates. From Government's view, it's a win-win.
The question of fairness of any tax structure is always questioned by those whose goals are not supported by that structure. There is no such thing as a fair tax as either it impacts someone more acutely in one area than another.
Our biggest complaint about wealthy and corporate tax payers is that they "don't pay their fair share". Please define that for me, I don't understand what you consider a fair share. What criteria defines a fair share?
If we believe our current progressive rates are fair then we must be complaining that wealthier groups have access to exemptions and loop holes the poorer groups do not. A true flat tax eliminates all of those so it must be more fair than what we currently have.
If you believe that our current rates are unfair because poorer people can less afford any tax than a richer person, then no tax rate can be fair. Equality of standard of living is not adjustable simply through taxes. Redistribution of wealth is only marginally affected by tax rates. If a program designed to redistribute enough wealth from the wealthy to the poor to even out the standards of living we would simply see the wealthy move someplace their money could not be touch and leave the rest of us in a worse condition that we are.
The only way I see to address this is to address taxes as a separate issue than equality or wealth disparity. If we use a flat tax with a single rate for all taxpayers and no exceptions, allowances or deductions; it will be a fair and equal tax rate. It will collect more gross taxes from the wealthy than the poor simply because it is percentage of income and there will be no way to avoid taxes except to earn less. That should even out the wealth distribution over the long run, right?
If we wish to push the envelope, we can do a similar structure as above with stepped rate tiers. A progressive flat tax if you will. Again, as long as there are no allowances, exemptions, deductions or other types of reductions or credits to taxes it will be fairer than what we have now in terms of tax avoidance. As long as the stepped tiers are not exceedingly aggressive, it should have minimal impact on the revenue generation base. If it becomes too weighted against the top income earners, they will find a more favorable environment to earn their wages and leave our taxation pool pushing more burden to the lower income earners to support the government.
Wealth redistribution is another philosophical debate often mixed with taxation when it should not. I will not try to address it here, but recently heard an argument against it that bears consideration before delving into it.
Do you want to live in a society where everyone is guaranteed poverty level income and no opportunity to earn more, or would you prefer to live where 5% will starve, 20% will make poverty level wages, 60% will make up to double poverty level wages, 10% will earn significantly more than poverty level wages and 5% could earn outrageous income levels and everybody competes for these wages with equal starting opportunity?
I think the chance of a good/better/fantastic life is more appealing than the guarantee of a lousy life. I just don't see the chance of the equal starting opportunity for most people. I think we are all already stratified and have equal opportunity with others in our strata and perhaps similar enough opportunity with most of the adjacent stratums, but not equal.
Where in the Constitution is the federal government empowered to equalize living standards?
I think it's in the IRS code somewhere, since that's certainly the result (except for the very rich, of course).
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