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What is the best option and why?
The current system is unbalanced, so how would it better be implicated?
It seems like no tax at all would be unrealistic, so if not the current income tax, which would you prefer and why?
-Flat Tax- everyone pays the same percentage of their income.
-Federal sales tax (what is sometimes called the Fair Tax)
-Other?
I am really on the fence about this one as all the options have good pluses and minuses.
:thinking:
How about a luxury tax! A tax on all items above and beyond our daily needs! Just a thought.
that's what a sales tax is. notice that stuff like bread, milk, school supplies, etc are not taxed. (at least, not in my state, might be different out in hippy land where you live :w )Quote:
Originally Posted by JMS
sic-> honestly, I think either of those options is a superior alternative to the current system that punishes financial success and lack of children. the sales tax is prolly a bit more fair, but the flat tax is WAY WAY easier to implement, and would lower administrative costs quite a bit. If we are to ignore overhead in this equation (admin costs, logistics, etc) I think that despite more complicated record-keeping, a sales tax is more fair.
as stated above, many items are not taxed if they are neccesities, (in my state) so the sales tax seems a bit more egalitarian as far as the very poor are concerned... if you spend all your money buying bread and milk, you don't make enough for taxing you to be worth the effort. I also disagree with the traditional definition of luxury tax, I think all items apart fron nonessentials should be taxed at a flat rate. (e.g. liquor is taxed more than soda, yachts are taxed more than cars, etc)
Neither flat nor sales tax will be the same for everyone.
There're many people that don't report they income, those will continue paying no tax on that income.
Once the best solution is found, the harder problem will be enforcement
I like the idea of a federal sales tax, but the flat tax would be a very easy solution, and I like the idea of a bunch of tax lawyers and IRS jerk being unemployed too.
But I need the hot tub for my back and the private jet makes my commute bearable, without my hundred room mansion I couldn't survive I get claustrophobic in something as small as 4000 square feet. Need is to relative, besides we know congress would decide we only needed bread and water but they needed everything else.Quote:
Originally Posted by JMS
amen and amenQuote:
Originally Posted by Wildtim
I think the hugest problem with the current tax code, is that no one has ever read it!!! Literally, I have heard that it is so long that a person is physically not capable of reading the whole thing, cover to cover in a lifetime. Now thats a problem.
I like flat and fair tax. Everyone pays the same percentage of income taxes, and anything beyond necessities has a sales tax. Like Tim said though, necessities will be a hard one to pin down.
What scares me though is when they start taxing online transactions. That's going to be a crappy day for everyone.
There are plenty of ways to implement a simpler tax code, and keep the tax progressive, without going for a flat tax. The 1040 EZ could just be extended to include all incomes, for example. Can't get much simpler than that. One tax table and standard deductions. Simplification isn't a fantastic flat-tax argument-- just a convenient one.
why would you want to? I think the point of the thread was that a progressive tax is "unbalanced" as sicboater put it.Quote:
Originally Posted by ScottS
I think that we should distinguish between types of income: active income from wages and passive income from investments. The income of people who work for wages is limited by the number of hours they can work, both physically and, in some cases by law, while the income that people can make from investments is unlimited. If you invest your money at 12%, it doubles in six years, and doubles again, in another six years, and so on. This means that people who have only wages that cover their living expenses will never get ahead, while those with capital to invest will get richer and richer, while doing nothing. I say, no taxes on wages and a flat percentage on investment income, plus a rather hefty tax on inheritances.
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Originally Posted by jockeys
Because I firmly believe that those who reap the most benefit from living in the US should be paying for the privilege. Perhaps the opinion stems from my grade school days, when we were taught about "regressive" taxes. I can understand why some people think of this as unfair. I don't.
Many of the sales tax and flat tax schemes all have rebates and exemptions for those not making much money, anyway.
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Originally Posted by Wildtim
Quite right! I wouldn't mind hearing someone proffer a solution that involved a progressive tax that is fair. I just don't think it is possible...Quote:
Originally Posted by jockeys
A very interesting point of view. I don't know about taxing inheritances though. It is highly likely that money would have been taxed already at least one time; but if not, what if you use it to invest? Then it would be taxed again under your outline. I like your separation of passive and active income. The problem (edit: I see) is, there is some investing that requires more time and skill than others (i.e. you can't be passive about day trading) would you have all capital gains taxed the same?
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Originally Posted by Chimensch
Well, maybe you could have a calculation of the number of hours spent actively involved in managing the investments, which would be active income.Quote:
Originally Posted by sicboater
The reason for taxing inheritances is so that families wouldn't accumulate great wealth over the centuries.
As for money being taxed more than once, I think that it is reasonable to tax money each time it changes hands. Why should someone have a huge advantage over someone else just because they had a rich parent?
why shouldn't they?Quote:
Originally Posted by Chimensch
Because, if the government has to take money away from someone, it would be preferable to take it from someone who had absolutely nothing to do with earning it.Quote:
Originally Posted by jockeys
My state already does, sort of. I'm supposed to declare at the end of the year any purchases I have made from out of state, This includes over the internet, while on travel, everything and then I'm supposed to pay a rate equal to the state sales tax on it. They call it the "Use Tax". I bet your state has one too. I don't think anyone pays it though, because it is totally on the honor system and would be huge bear for a prosecutor to prove you have violated, unless it is one big purchase that could be tracked.Quote:
Originally Posted by Quick Orange
I believe that a progressive tax in inherently unfair, as it punishes those who do well, and those without children. (under our current rules)Quote:
Originally Posted by sicboater
I once asked a liberal friend of mine why he thought the rich should not only pay more in absolute terms, but in relative terms. He replied, "they can afford it."
Well, by his logic (and I use the term in the loosest possible sense) it should be LESS ILLEGAL to mug a rich person than a poor one, because the rich guy can afford to be mugged.
One poster mentioned that those who reap more benefits should pay for the privilege. I believe it is not a privilege at all, but something you work hard for (has been in my case) and EARN. I'm not saying that there aren't people out there that defy this rule... there are. I'm just saying it seems grossly unfair to punish those who work hard and do well simply for working hard and doing well.
I am also going to go ahead and state my sincere belief that children and dependents should NOT reduce your taxable income. As discussed at great length in another thread, I am of the opinion that children are a luxury. When I lived in East Texas, I had this neighbor that was a crackwhore. I'm not being cruel, she was a crack addict and a prostitute, literally. She had 5 kids. And no real job. Every year at tax time, I had to pay a large percentage of my income because I was
a. single
b. childless
c. financially successful (at least, moreso than average, in that county)
She, on the other hand, got enough welfare to feed her children and buy her smokes and beer, plus the county helped with her rent. As if this was not frustrating enough, one day I met her our mailboxes, and she cheerfully told me she was pregnant. Unsure why she was cheerful, I politely congratulated her anyway. She then tells me, "Yep, dat's real good news fer me, gummint gon gimme two hunnerd extra ey month now." (Cajun accents are hard to represent typographically, use your imagination) Flummoxed and enraged by this, I ask her if she knows where the money comes from. "Gummint. De gimme uh check" I responded, "Yes, but where exactly does the government get the money?" She thought for a minute, and said, "well, I figger de gummint get they money from taxin' people." I told her this was correct, and that I was one of the people who paid these taxes. I even went so far as to say that I found it unfair. She shot back, "unfair! you tell me bout unfair, you ain't got no five kids to feed!" I told her that was true, I had decided not to have children. She elaborated, "you got dat new car, dem nice clothes, you got all kinna stuff. you kin affor' it." I then asked, quite simply, why I should have to pay for her mistakes. There was a tense, silent moment, that ended abruptly when she threw her beer bottle at me (drinking while pregnant, really nice) and stomped back into her house. That conversation has stayed with me for years, and most likely will remain in my mind the rest of my life. I had never seen such an obtuse sense of entitelment. I instantly hated the system that had allowed this situation to occur. I didn't know where she had gone wrong... we were the same age, the same color, had both gone to public school, etc. I had decided to work my butt off, take out student loans and make something of myself. She had decided it wasn't worth the trouble, evidently. I despised her laziness, and I despised even more the beaurocrats that decided she was right: I COULD afford to have my money taken. So they were going to. And they were going to give it to her, and everyone like her. How could I NOT hate the system?
If you ever wondered why I'm a rabid libertarian, and have such a violent, burning hatred for socialism, now you know. It's fundamentally wrong. If people can abuse a system, they will, that is one thing I have learned in life. If the system has to go wrong in one direction, I'd rather it let people get away with success than get away with subsidized failure.
No amount of taxation will support the current US federal government budget, so for me the question is not one of solving a problem, but merely one of how much the people will put up with.Quote:
Originally Posted by sicboater
Tax me zero, tax me 100%, the same overspending will go on as it has been for decades
The wealthy abuse the tax system every day, too, only the amount of money they hide/steal/unfairly trade for dwarfs the social programs you're so rabid about ending. One might argue that the more successful people that "get away with it", the more poor people there will be because of the crimes of the wealthy.Quote:
Originally Posted by jockeys
so that it can be given to/spent on those who had equally nothing to do with earning it?Quote:
Originally Posted by Chimensch
I'd still rather reward ambition than laziness, if I have to choose between the two. As an honest person who does well for himself and DOESN'T cheat on taxes, I don't enjoy being unfairly punished for my success.Quote:
Originally Posted by ScottS
Theoretically, the government spends money on things that benefit everyone, for the common good.Quote:
Originally Posted by jockeys
Hey, now there's a commonist idea! Somehow I doubt the government knows how to benefit everyone though :( To take it to the extreme, why not just do away with currency completely and let the government proportion all the necessary resources to those who need it?Quote:
Originally Posted by Chimensch
hah! maybe in Italy. Here in the states, tax money gets spent on lobbyists, special interest groups, and pork contracts to friends of politicians.Quote:
Originally Posted by Chimensch
Well, again, I'm going to step up and say "you say punish, I say contribute". You see that woman as lazy, I see someone who has been let down by society, sees no hope and no way out, and is trying to survive however she knows how. I know, I know, we've had this argument before and neither of us are going to change the other's mind. :)Quote:
Originally Posted by jockeys
But anyway, back on topic. We had an argument over here about the impact of a goods and services tax (GST) which I think is similar to the Federal sales tax? Over here, an item costs say 100 dollars. We have 10% GST, so $10 is charged in tax. To a person earning 100K a year, that's 0.01% of their income. To a person earning 30K a year, it's 0.033% of their income.
James.
Ah, you're talking about how taxes are spent ... I thought the discussion was about how they should be collected.Quote:
Originally Posted by jockeys
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Originally Posted by Chimensch
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Originally Posted by jockeys
Looks like you are both talking about how it is spent.:cool: I don't mind, it's good stuff.:)Quote:
Originally Posted by Chimensch
If it was voluntary, I would agree. But it's not. If we were talking labor instead of capital, involutary would equal slavery. But, agree to disagree.Quote:
Originally Posted by Jimbo
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Originally Posted by Chimensch
Now take this theory and apply it to the woman from jockeys example.
Or to make the question more pointed, How does that woman by her presence contribute contribute anything that could be called good.
Also know that she "wasn't let down" by any system, she could have a mother who's living was earned the same way and probably is producing children who will earn their living the exact same way she is.
If you can find any "common good in that" you are a far more generous person than I.
I also lived near a welfare family, they got more per kid though because their offspring was brain damaged. I will admit though that they were more ambitious than Jockeys crackwhore the family I knew went out and got jobs, and three months later bought a house and new car then quit their jobs to go back on welfare again. You see they could make more with less effort being on welfare than working as long as they had two retarded kids but the needed jobs to get the credit to buy the house. It wasn't even like they were comparing welfare to minimum wage either she was a paralegal (how she knew the system) and he was a trained book keeper.
All I'm saying is that I refuse to believe that as a young child this woman's dream was to become a drug addict. Something happened to her between child-and-adult-hood which lead to that outcome. Of course she was let down by the system.Quote:
Originally Posted by Wildtim
The "good" that could be found here is what a society does with people in these positions. What "good" is there in writing people off as no-good drug whores? Why isn't it better to try and get someone back into society so that they can start contributing again?
Your welfare system is not means-tested? Here your assets are assessed when determining payment.Quote:
I also lived near a welfare family, they got more per kid though because their offspring was brain damaged. I will admit though that they were more ambitious than Jockeys crackwhore the family I knew went out and got jobs, and three months later bought a house and new car then quit their jobs to go back on welfare again. You see they could make more with less effort being on welfare than working as long as they had two retarded kids but the needed jobs to get the credit to buy the house. It wasn't even like they were comparing welfare to minimum wage either she was a paralegal (how she knew the system) and he was a trained book keeper.
James.
I would say that the system isn't responsible for people ending up the way they are. If that was true, I would be working some dead end job at minimum wage right now with no place to go. Welfare works on technicalities, and as long as you fit under those technicalities, you can get it.
For instance, with education here, you're considered a dependent until you're 25, married, or in the military, even if you can prove independence and your parents don't claim you on taxes. There is no investigation or even attempts to check, they just go by the checklist. Welfare works the same way. No job+kids-father=paycheck in the mail.
There are people out there that really need it and that it really helps. There was a time a long time ago when my parents were on food stamps and really needed it. I was a new born, so my mom took care of me while my dad worked two jobs and went to night school. They made mistakes (me!:roflmao), but they tried hard and needed a little help. Something that has stuck with me though is a conversation I had with my dad about 10 years ago: He said, "you know, it was embarrassing being on food stamps, but what got me was the amount they gave us. I've rarely eaten better in my life than when we had food stamps. We even told them that it was way too much money, but they made us take it. It was so much that we gave steak, shrimp, and lobster to people for Christmas." To me, that's as ****ed as it gets. Honest people tell you how much they need and the government gives them 5 times the amount and tells them it's either that or nothing.
Exactly Orange, I've got a friend who just had to quit his part time job because he lost his day job and if he had kept his part time job he wouldn't have been able to qualify for the unemployment he needs to keep his family fed. They could have reduced his benifit by the amount he made on the part time job or something, but its either all or nothing.
Apparently you guys don't yet have multi-generational welfare families over there. Over here we do. There are girls in high school over here actually trying to get pregnant by the guys they think will support them and the kid, they just want the support they don't care about the guy or even want to marry him and these are teens.Quote:
Originally Posted by Jimbo
Check this out:
WELFARE AND THE CULTURE OF POVERTY
You can't qualify if you have means, but a place to live and one car per family are excepted from your assessment as they are considered basic needs no matter how nice they are.Quote:
Originally Posted by Jimbo
let down by the system? since when is it the system's job to cover your screwups? she let herself down. we all make choices. we SHOULD all have to face consequences. your life is nobody's responsibility but your own. it's not like we live in africa with warlords and no economy. at any point in time, she could have walked down the street to mickey d's and gotten a job flipping burgers. welfare was just easier. you say the system let her down? if you mean it let her down by offering her an easy way out of a hard situation, which is evidently even more addictive than crack, they you're damn right the system let her down.Quote:
Originally Posted by Jimbo
I mean, who WOULDN'T go for welfare? if I didn't have any decency, it'd be great to make a living without having to make a living, if you know what I mean.
The federal government in a federation should not be allowed to raise a tax from individual citizens. Income taxes, sales taxes, etc. should all be illegal.
Local governments should raise property and head taxes and pay for the federal government which they, as members of the federation, created. The federal and local governments should collect royalties on the natural resources for which they are responsible and user fees for services offered. Foreigners should pay a small fee upon entering and exiting the country, for services they may potentially take advantage of during their stay. Also, there ought to exist reviewed tariffs on certain imported products, especially those who's production or manufacture was subsidized in their country of origin. Finally, fines and corporal punishment instead of imprisonment for non-violent crimes should be the norm.
Tax exemptions should exist for the poor and needy, those that have taken vows of poverty, children and the elderly, the sick and especially sick war veterans, refugees, foreign diplomatic staff, etc. The tax burden should be small but still ought to rest on the shoulders of the strong.
Any potential surpluses should be returned to the people in the form of real cash.
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Originally Posted by Whiggamore
Very true, all of it.
And what do you know......This is exactly what the founders set up in the first place.
It's amazing how badly things have been screwed up, and all in the last hundred years.
My problem with a federal sales tax as a replacement for the federal income tax is this: Let's say wage earners like Bill Gates or Rush Limbaugh make $500 million dollars in a particular year but decide to "sit it out" in terms of making any major purchases. So for a year they forgo buying any yachts, new cars, houses, large screen tv's etc and decide they are basically "content with their lot" for the year and only purchase basis necessities such a food, clothing, etc. Under that scenario they could end up paying the about same amount of taxes on their enormous earnings as the blue collar worker who has to spend most of his or her income just to make ends meet. That does not strike me as a fair system of taxation.
So you'd rather have a tax on people for their hard work than for their toy purchases?Quote:
Originally Posted by billyjeff2