Taxes

Percivale · Jul 28, 2019

The three main types of taxes are income, sales, and property taxes. Any tax discourages what it taxes. I think income does not warrant discouragement at any level, sales of non-necessities should be discouraged at every level (I oppose materialism and clutter), and property should be encouraged for those who own little and discouraged for those who own a lot. So I'd prefer no income tax, a sales tax that exempts necessities, and a progressive property tax.

On the federal level though, ending income tax is not realistic, but what should be done is to end the Medicare and maybe Social Security payroll taxes, both employer and employee contributions, and fund those programs some other way. Payroll taxes are somewhat regressive and depress wages, as well as distorting the health insurance market.

OldWiseGuy · Jul 28, 2019

Taxation is necessary, but should be spent more wisely. Social Security and Medicare are two of the best government programs ever devised, and needed now more than ever.

Desk trauma · Aug 11, 2019

Percivale said:
On the federal level though, ending income tax is not realistic, but what should be done is to end the Medicare and maybe Social Security payroll taxes, both employer and employee contributions, and fund those programs some other way.

Let us know when you come work that out.

Percivale · Aug 11, 2019

You could replace the payroll taxes with increased regular income tax, or a carbon tax, or increasing inheritance tax, there’s plenty of options.

Desk trauma · Aug 11, 2019

Percivale said:
You could replace the payroll taxes with increased regular income tax...

What happened to not wanting to "discourage" people from earning income by taxing it?

Percivale said:
or a carbon tax, or increasing inheritance tax, there’s plenty of options.

But wouldn't that discourage people from amassing wealth to pass on or even having anything on hand at ones passing?

Percivale · Aug 11, 2019

Desk trauma said:
What happened to not wanting to "discourage" people from earning income by taxing it?

But wouldn't that discourage people from amassing wealth to pass on or even having anything on hand at ones passing?

The carbon tax would be my first choice but even regular income taxes are better than payroll taxes since they come after deductions. And I do want to discourage people from amassing millions to pass on. The inheritance tax doesn’t apply to anyone inheriting less than several million.

Desk trauma · Aug 11, 2019

Percivale said:
The carbon tax would be my first choice but even regular income taxes are better than payroll taxes since they come after deductions.

Why is that preferable?

Percivale said:
And I do want to discourage people from amassing millions to pass on.

Why?

Percivale said:
The inheritance tax doesn’t apply to anyone inheriting less than several million.

Would your increase see it applied to smaller amounts or just a largest portion taken from those currently above the threshold?

Percivale · Aug 11, 2019

Desk trauma said:
Why is that preferable?

Why?

Would your increase see it applied to smaller amounts or just a largest portion taken from those currently above the threshold?

Payroll taxes discourage employers from paying as high of wages and encourage them to give other benefits instead. That reduces employees health insurance options since they have to get it through the employer. Regular income taxes don’t have that effect. Also if it comes after the standard deduction it’s more progressive.

I want a carbon tax because I want to pass on a clean environment and stable climate to my children.

Inheritance tax should mainly increase in rate on the current threshold. I want to be sure it never taxed an amount below the average net worth. I support that sort of thing because inequality and oligarchy are bad for our country.

Trogdor the Burninator · Aug 11, 2019

Percivale said:
The three main types of taxes are income, sales, and property taxes. Any tax discourages what it taxes.

Does your Sales tax include services? - many economies have gone over to a GST rather than just pure sales tax in recognition that a service should attract a tax rather than jut a physical good. A broad-based GST is also very hard to avoid.

Percivale · Aug 12, 2019

Trogdor the Burninator said:
Does your Sales tax include services? - many economies have gone over to a GST rather than just pure sales tax in recognition that a service should attract a tax rather than jut a physical good. A broad-based GST is also very hard to avoid.

I’d like to learn more about that. I would consider taxing sales of physical objects at a higher rate than services, if they use more natural resources, for environmental reasons and to fight the clutter epidemic.

Trogdor the Burninator · Aug 12, 2019

Percivale said:
I’d like to learn more about that. I would consider taxing sales of physical objects at a higher rate than services, if they use more natural resources, for environmental reasons and to fight the clutter epidemic.

It came about partly to remove the weird situation where a $50 radio attracted sales tax of 25% but a $1,000 dinner was tax-free. Australia implemented it back in the 90s, putting a 10% GST on most items (except for food and education), and lowering income tax to counter it. It makes sense from the POV that most first-world economies ended up becoming more service-based than manufacturing-based.

It also help reduce avoidance, because even if you get paid entirely in cash which you don't declare, you still have to spend it, which attracts the tax.

Yekcidmij · Aug 13, 2019

Percivale said:
On the federal level though, ending income tax is not realistic, but what should be done is to end the Medicare and maybe Social Security payroll taxes, both employer and employee contributions, and fund those programs some other way. Payroll taxes are somewhat regressive and depress wages, as well as distorting the health insurance market.

Sounds great. So how does this get through Congress? I mean, if we're going to be realistic, then nobody is ever really touching Medicare and Social Security and there probably isn't a better way to fund them except via payroll taxes. And if you could identify another funding mechanism, then you have to get it through the legislative process. How many people would be onboard? Probably not too many.

ananda · Aug 13, 2019

OldWiseGuy said:
Social Security and Medicare are two of the best government programs ever devised, and needed now more than ever.

Not so much for the younger generation(s), who will likely not see any returns from either program.

Percivale · Aug 17, 2019

Yekcidmij said:
Sounds great. So how does this get through Congress? I mean, if we're going to be realistic, then nobody is ever really touching Medicare and Social Security and there probably isn't a better way to fund them except via payroll taxes. And if you could identify another funding mechanism, then you have to get it through the legislative process. How many people would be onboard? Probably not too many.

Medicare is already not fully funded through the payroll tax, so it wouldn’t be much of a change to switch it to just being funded by regular income tax. I don’t expect any of these changes to happen in the next couple of years, but Congress will change over time and some of these ideas are not really more of a change than the recent tax reform, and quite a bit smaller than the affordable care act was. And this is about the state level just as much as the federal level; I could see my state (Indiana) ending its income tax, since a majority of its money already comes from sales tax.

I think it’s especially important to end the employer contributions to Medicare and Social Security, because they are what discourage employers from raising wages and encourage them to pay healthcare instead, which results in our not having a free market healthcare system since people can only get the plans their employers approve. Without employer healthcare dominating the market we would probably see more different models than regular health insurance, such as Medi-share, or direct healthcare subscriptions offered by hospitals or doctors.

Percivale · Aug 17, 2019

Trogdor the Burninator said:
It came about partly to remove the weird situation where a $50 radio attracted sales tax of 25% but a $1,000 dinner was tax-free. Australia implemented it back in the 90s, putting a 10% GST on most items (except for food and education), and lowering income tax to counter it. It makes sense from the POV that most first-world economies ended up becoming more service-based than manufacturing-based.

It also help reduce avoidance, because even if you get paid entirely in cash which you don't declare, you still have to spend it, which attracts the tax.

My state charges 7% sales tax on restaurant bills and on things like candy and pop. It’s only regular grocery store food that’s exempt.

HannahT · Aug 18, 2019

Percivale said:
On the federal level though, ending income tax is not realistic, but what should be done is to end the Medicare and maybe Social Security payroll taxes, both employer and employee contributions, and fund those programs some other way. Payroll taxes are somewhat regressive and depress wages, as well as distorting the health insurance market.

Seniors and the disabled rely on Medicare and Social Security. Unless you have an idea on how to regularly fund these programs that is realistic to majority of America? Good luck with getting rid of them. People will freak out, and it will be over before it even starts.

The health insurance market is entirely different egg altogether. Group insurance is what bigger employers use to keep the healthcare costs down. Companies - not all but generally - tend to contribute to these lower cost plans YES as a benefit. There are tax reasons for both the employee and employer as to why this is done to save more. One of the reasons is they take that out of your paycheck (premium), and then tax what is left. I'll never understand why they can't redefine what a 'group' is so many others could have this savings. Until the government - and healthcare industries - decide what will work to bring costs down for all. I'm dreaming to think that will happen, but realistically it should. Costs are insane, and there are plenty of factors that enable those. One twist won't do much to save on those costs.

Taxes

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