How about a flat tax?

Originally posted by kern
How does the government get money for anything if there are no taxes at all? While I'll agree that the government wastes money, it doesn't seem that the government could function with a zero income.

-Chris

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by way of the leprechaun initiative. those guys have pots of gold stashed everywhere!

kern

Better schools can improve property values and quality of life,

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In the past proximity to a school was a big plus, especially for parents with grade school or high scholl children. That was then. Sad to say, now, it is not only not a + but in fact a negative, because of gangs, violence at school, etc...

cenimo,

Should people only pay Social Security tax if they use it? That wouldn't be feasable, because there would never be enough in reserve to cover the checks. What about city or state run homeless shelters? Taxes pay for those, am I being punished because I own a home? Or am I paying to help keep homeless people from freezing to death in an alley? What about state funded medical insurance programs? Am I being punished for having a job that affords me great medical coverage, or am I helping less fortunate people get the medical attention they are entitled to as a citizen?

If everything was privatized (schools, law enforcement, fire), and you only paid per use, I'd be willing to bet in the end the cost would be far more than the amount taken in taxes from you checks now.

And as one who can speak from experience, when you NEED a program that is funded by tax money, you'll be glad it's there. When you're past needing it, you'll be a little more happy to help it out, for all of those that need it after you. At least I am.

Dewjunkie

Gee, all I commented on was people without children paying the portion of property taxes that go to schools...and no one did reply about a center for childless couples and the uproar that would cause.

Let's see, some states now tax unempoyment, right? Gee, that makes a lot of sense...

There's a book called The April Game, by an autjor (ex-gov't investigator) calling himself Dogenes...it covers a lot of this, well worth reading.

Originally posted by Dewjunkie

Unfortunately, as with anything that might make life simpler and in the end would cost the wealthy more money, it is unlikely that a flat tax would ever come to pass.

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Actually, a flat tax would be more beneficial to everyone.  It is the liberal belief that the wealthy should be punished for success, that keeps the flat tax from being considered as an actual viability.

Originally posted by Dewjunkie

Should people only pay Social Security tax if they use it? 

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I feel inclined to agree with that part of your post, but not all of it.

Should people only be required to pay for a road if they actually drive?  That wouldn't be fair, now would it?

Notes: Caley stated he felt that no taxes of any sort should be levied, not me.

Secondly:

Actually, a flat tax would be more beneficial to everyone. It is the liberal belief that the wealthy should be punished for success, that keeps the flat tax from being considered as an actual viability.

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I take it you view it as a coincindence that the flat tax is often pushed hardest by those who would pay nothing in taxes if it were passed.

Forbes comes to mind.

Originally posted by Morat

I take it you view it as a coincindence that the flat tax is often pushed hardest by those who would pay nothing in taxes if it were passed.

Forbes comes to mind.

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If an actual flat tax were passed, everyone would pay the same percentage.  There would be noone who paid 'nothing'.  I don't know whose plan you are looking at.

We've seen proposals just in this thread for flat tax plans where interest off of investments is not charged tax. Since the very wealthy make virtually all their income from interest, under such a flat tax plan, they would pay next to nothing.

-Chris

Originally posted by kern
We've seen proposals just in this thread for flat tax plans where interest off of investments is not charged tax. Since the very wealthy make virtually all their income from interest, under such a flat tax plan, they would pay next to nothing.

-Chris

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By your response, I take it that you know alot of very wealthy people and their financial records.  Being in the upper 10 percent of wage earners myself, I know where my income comes from and it's not primarily from investments.

By the way, a household only needs to earn $ 92,000 a year to be in the upper 10 percent of wage earners.  That means a teacher married to a fire-fighter are considered rich in this economy.  Do those people really deserve to be punished for their success?

In the actual plan that is on the table now, cutting out tax on investment income would encourage more people from every tax bracket to invest.  If that wouldn't strengthen the economy, what would? 

Just using logic here. 

If an actual flat tax were passed, everyone would pay the same percentage. There would be noone who paid 'nothing'. I don't know whose plan you are looking at.

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Forbes', actually. He wouldn't pay any money under his plan. Neither would Bill Gates, or Cheney (he would on his VP salary, of course).

In the actual plan that is on the table now, cutting out tax on investment income would encourage more people from every tax bracket to invest. If that wouldn't strengthen the economy, what would?

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Money on the demand side. As has been noted, the problem with the economy is too much capacity for too little demand. Increase capacity without increasing demand would just make it worse.

Regardless, it would still lead to the richest people in America earning millions of dollars a year and not paying a penny in taxes.

And somehow it's dubbed "class warfare" to get upset at that idea.

Just using logic here.

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But not all the facts.

Originally posted by Morat

And somehow it's dubbed "class warfare" to get upset at that idea. 

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Actually, "class envy" is the term.  It's pretty accurate.

Actually, "class envy" is the term. It's pretty accurate.

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You're right. I would be really envious if people making millions of dollars a year paid nothing in taxes, where people like myself where chunking in 20% or so.

The question, I suppose, is why you wouldn't be? I mean, let's face it, it's really unusual to meet someone whose so cheery about paying taxes that'd he rather pay a higher rate so that poor millionaires don't have to pay anything.

Just some info from the IRS Stats page.

top 1% of returns paid 29% of taxes, yet earned only 15% of income.

top 10% of returns (average Income $158,000) paid 63% of all taxes.

top 20% of returns (average Income $120,000) paid 79% of all taxes.

top 40% of returns paid 94% of all taxes.

Seems fair to me, not.

Investment Income under a flat tax would be taxed at the corporate level like it is now. It would just not be taxed again at the individual level.

The only thing that is taxed now that would not be taxed under the flat tax are Capital Gains, which probably should not be taxed anyway.

With the first $35,400 of income being exempt, it seems more fair to me. We should not Tax success.

Of course, I would pay about $6,000 less per year... That may bias my opinion

Ahem. Link please. First off, I suspect payroll taxes were not included. When payroll taxes are included, the system is only mildly progressive.

Secondly, as an IRS page, I know state and local taxes (which are generally fairly regressive) where not included.

Citizens for Tax Justice (a labor funded group) have stats here.

To be blunt, income tax looks so progressive because payroll and excise taxes are really regressive. It's deceptive to only look at part of the taxes an individual pays. At the very least, you should use numbers that include payroll taxes, as that's 7% that you only pay on income below 85,000. So please, don't tell me how progressive and unfair the income tax is when you leave out the rest of federal taxes.

OK Morat, using your link, the numbers are just about the same.

top 1% of returns paid 25.1% of all taxes

top 10% of returns paid 41.2% of all taxes.

top 20% of returns paid 67.7% of all taxes.

top 40% of returns paid 85.6% of all taxes.


The one change I would love to see in the tax system is totally revenue nuetral. I want to do away with withholding and have everybody have to make quarterly estimated tax payments. Writing that check Every quarter is ALOT more painful than having it come out of your check allmost invisibly 26 times a year.

My link doesn't include payroll or state taxes either. I was sourcing the material you didn't.

Taxes are 7% higher on anyone on income lower than 85,000 a year, and it doesn't show up on income tax projections. That's from payroll taxes alone.

Yes it does Morat, look again

From your link, this is just the fed income tax.

top 1% of returns paid 36% of all taxes

top 5% of returns paid 56.1% of all taxes.

top 20% of returns paid 81.7% of all taxes.

top 40% of returns paid 95.7% of all taxes.

What I posted before is the far right Col. on the chart titled "Precentage Distribution of Pretax Income & Federal Taxes By Income Group"