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The Best Tax Proposal in the History of the World

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  • #16
    Originally posted by Darth Executor View Post
    Pretty dumb tariff model. How many countries export the same thing they import? How does this solve the problem with third world countries skirting labour/environmental laws american producers cannot avoid (and the resulting drop in price)?
    I was curious about the response to that. I admit I do not have deep roots in international trade. It may be dumb/over-simplistic.

    Originally posted by Darth Executor View Post
    I also oppose getting rid of double taxation. Dividends are taxed separately because corporations are their own legal entities. It's like saying your boss shouldn't be taxed because you got taxed already.
    I run a business. At the end of the year, the business has a profit (hopefully) and it goes in one of three directions:
    • retained earnings (for use in later years),
    • investment in the company (buying stuff, etc.),
    • dividends to shareholders.


    #1 is temporary, because in future years it will either stay retained earnings (doing nothing), or become #2 or #3.
    #2 should not be taxed, IMO, because it disincents companies to grow.
    #3 is income to the shareholders - if it is taxed as regular income, then it is being taxed. The boss does not get away with not being taxed - they simply pay it as personal income instead of business income.

    Am I missing something?
    The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

    I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

    Comment


    • #17
      Originally posted by Starlight View Post
      I don't like sales taxes, so I'm with you on this. They are administratively complex to comply with, and they fall far more on the poor more than the rich (e.g. if a poor person lives paycheck to paycheck and spends 100% of their income weekly, then a 10% sales tax is equivalent to +10% income tax for them. But if a rich person saves 99% of what they earn and only spends 1% of their income weekly, the 10% sales tax is equivalent to +0.1% income tax for them). This is why the mega-rich would love to have only a sales tax (e.g. the "fair tax" system) so they basically don't have to pay any tax at all.

      Disagree. For one, rich people and companies are very good at avoiding taxes, so if the government tries to tax the same money twice they are more likely to actually get some of it at least one. Also companies can do a number of complex things with profits (stock buy-backs etc) that differ from dividends but which have the effect of transferring wealth to their shareholders. Also companies can have overseas shareholders who's dividends aren't taxed so if you are going to tax the money you need to do it when the company makes it. Also company taxes (on larger companies anyway) are a nifty source of government revenue because it doesn't upset people as much as income taxes do where they can see you taking it from them.
      The tax avoidance thing I don't agree with - companies tax-avoid today a) because they are being taxed, and b) because there are loopholes. If you eliminate corporate taxes you eliminate a). If you eliminate deductions for personal taxes, you eliminate b). I do agree that something has to be factored in for share-buy-backs - not sure what. The international dividends are not a problem - you simply require the company to automatically tax non-domestic dividends at the standard rate before they are paid out. Sort of like collecting sales tax when a purchase is made.

      Originally posted by Starlight View Post
      I used to think that, so I thought capital gains taxes should be equal to income taxes. Now I have come to think they should be a lot higher than income taxes. Consider it this way: If a person works hard all day at their job and earns an income from their employer, did their efforts have the same social value as if they'd sat on their behind and twiddled their thumbs all day while assets they happened to own increased in value by the same amount as the stock market went up? Why should the government tax a person's hard work as highly as they tax a person who gains the same amount of money by not working at all? One is contributing to society and the other is a parasite on society. I see no reason not to put capital gains / interest / dividends / investment taxes up to ~90%. They certainly should be higher than income taxes.
      I don't think the government should be in the business of deciding which money-making scheme (assuming it is legal) is better and should be taxed differently. The government is there to provide services and needs money to do it. Making a value judgment on who's work is more "valuable" is not the government's business - even if I agree with you that it IS more valuable (socially).

      Originally posted by Starlight View Post
      Agreed. The tax system here has very very few deductions (like literally three), and it makes everything soooo much easier. The US tax system seems absurdly complex to me primarily because of deductions and loopholes.

      This seems to make sense primarily in terms of your proposed fixed rate of taxation for all income levels. I am quite happy with the idea of 0% tax paid below a certain income threshold calculated based on cost-of-living.

      1000% nope. The same rate for all income levels, rather than a progressively increasing rate based on income like all Western countries currently have? That would just pour money into the hands of the rich. The wealthy mega-donors would looooove it, everyone else not so much because everyone else's tax rates would have to go up massively to compensate for your removal of high-income tax brackets. People complain about income inequality/wealth inequality now, but your system would increase it by an order of magnitude or more.
      You get the same effect, basically, just with a sliding scale instead of fixed brackets. Again - I do not think the government should be in the business of deciding who has a right to keep more or less money as a percentage. Once ensuring that everyone has a fair living base that is tax free (and I am not talking about the paltry "standard deduction" we currently have, I am talking about an annual living wage), the government should then tax the "excess" equally. The effect is a progressive tax with a higher effective rate for the wealthy and a lower effective rate for the less wealthy. If we try it with some numbers, you can see the effect:

      Individual standard deduction: $50,000
      Determined tax rate: 35%

      Income/Tax/Effective Percentage
      $20,000/$0/0%
      $40,000/$0/0%
      $60,000/$3,500/5.83%
      $80,000/$10,500/13.1%
      $100,000/$17,500/17.5%
      $200,000/$52,500/26.25%
      $300,000/$87,500/29.17%

      Higher earners approach the 35% limit. Without a wide array of loopholes and evasions, they have no means for driving their tax down to today's effective rate that is often in the teens or even single digits for the most wealthy.
      The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

      I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

      Comment


      • #18
        Any change to federal taxation that leaves the IRS in place is simply a scam.
        Micah 6:8 He has told you, O man, what is good; and what does the LORD require of you but to do justice, and to love kindness, and to walk humbly with your God?

        Comment


        • #19
          Originally posted by Jedidiah View Post
          Any change to federal taxation that leaves the IRS in place is simply a scam.
          With that I would disagree. Taxation will still require returns, and will still require processing of those returns as well as auditing. It should be a shadow of itself, especially with the right computer support, but I cannot see it disappearing entirely.
          The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

          I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

          Comment


          • #20
            Originally posted by carpedm9587 View Post
            With that I would disagree. Taxation will still require returns, and will still require processing of those returns as well as auditing. It should be a shadow of itself, especially with the right computer support, but I cannot see it disappearing entirely.
            Abolish the IRS and release all its employees to live under the law the same as us, and turn those functions over to the GAO.
            The first to state his case seems right until another comes and cross-examines him.

            Comment


            • #21
              I think it should just be made bipartisan. Liberals always want higher taxes and Republicans always want lower taxes. So we will double the taxes on Democrats and halve them on Republicans. That sounds fair, right?

              Comment


              • #22
                Originally posted by Cow Poke View Post
                Abolish the IRS and release all its employees to live under the law the same as us, and turn those functions over to the GAO.
                Actually - you make a good point (for once )

                Seriously - I don't give a fig if the IRS is or is not abolished, so long as the necessary administration to collect and process tax payments and chase after tax avoiders exists somewhere. The term "IRS" has given so many (especially on the right) a bad taste in their mouth, a little reorganization and rebranding might be in order.
                The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

                I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

                Comment


                • #23
                  Originally posted by carpedm9587 View Post
                  Actually - you make a good point (for once )

                  Seriously - I don't give a fig if the IRS is or is not abolished, so long as the necessary administration to collect and process tax payments and chase after tax avoiders exists somewhere. The term "IRS" has given so many (especially on the right) a bad taste in their mouth, a little reorganization and rebranding might be in order.
                  Personally, I don't think the IRS can be "reformed", and if it's simply "scaled down", there's no way to know that we keep the best workers, as opposed to those who have the greatest tenure or longevity -- and associated agendas. I really think it needs to be either a new (but I hate new government organizations) or existing entity that is tasked with accounting, and it just seems the GAO might be the ticket.
                  The first to state his case seems right until another comes and cross-examines him.

                  Comment


                  • #24
                    Originally posted by Cow Poke View Post
                    Personally, I don't think the IRS can be "reformed", and if it's simply "scaled down", there's no way to know that we keep the best workers, as opposed to those who have the greatest tenure or longevity -- and associated agendas. I really think it needs to be either a new (but I hate new government organizations) or existing entity that is tasked with accounting, and it just seems the GAO might be the ticket.
                    And something scaled down can even easier be built back up

                    I'm always still in trouble again

                    "You're by far the worst poster on TWeb" and "TWeb's biggest liar" --starlight (the guy who says Stalin was a right-winger)
                    "Overall I would rate the withdrawal from Afghanistan as by far the best thing Biden's done" --Starlight
                    "Of course, human life begins at fertilization that’s not the argument." --Tassman

                    Comment


                    • #25
                      Originally posted by Sparko View Post
                      I think it should just be made bipartisan. Liberals always want higher taxes and Republicans always want lower taxes. So we will double the taxes on Democrats and halve them on Republicans. That sounds fair, right?
                      There's those superlatives, again.

                      Your post made me wonder - so I went digging. I found that, in a sense, that is already happening.

                      If you look at tax payment vs. return (https://www.theatlantic.com/business...takers/361668/), 14 states pay more to the fed than they get back, and 36 get more than they pay. Of the 14 that pay more than they get, seven are solidly blue (California, Massachusetts, NY, Delaware, Minn. NJ, and Ill.), five are solidly red (Kansas, Wyoming, Oklahoma, Nebraska and Utah), and two are swing states (Ohio and Colorado). When you compare these states by population, by far blue states pay more into the fed than they get back. Of the 36 that get more than they pay, 21 are solid red, 6 are solid blue, and the remaining 9 tend to swing (no pun intended). Of the top ten that get more than they give, eight are red states, one is blue (Hawaii), and the tenth is swing (Florida).

                      The numbers are pretty stark, but they tell a compelling story: it is apparently easy to have low state taxes (mostly red states), you just have to draw more revenue from the fed. States with higher taxes (mostly blue) don't draw as much from the fed and tend to be more self-reliant. And, under the new tax plan, they get penalized for it, because now the deduction for those higher taxes are capped at $10K.

                      Politically, that is a very smart (if somewhat unscrupulous) by Republicans in Washington. Blue states are unlikely to ever vote for a Republican (though they once did for Reagan in droves), so hitting them with more taxes doesn't cost the Republican party anything. Minimizing the pain for red states, meanwhile, is likely to play well with the base and lock those states in (not that they really need it).

                      The big question will be, what about the swing states?
                      The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

                      I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

                      Comment


                      • #26
                        Originally posted by rogue06 View Post
                        And something scaled down can even easier be built back up
                        EGGzackly! If the workers from the former IRS want to stay in the same line of work, they'd have to apply and qualify for their jobs with the GAO.
                        The first to state his case seems right until another comes and cross-examines him.

                        Comment


                        • #27
                          Originally posted by Cow Poke View Post
                          Personally, I don't think the IRS can be "reformed", and if it's simply "scaled down", there's no way to know that we keep the best workers, as opposed to those who have the greatest tenure or longevity -- and associated agendas. I really think it needs to be either a new (but I hate new government organizations) or existing entity that is tasked with accounting, and it just seems the GAO might be the ticket.
                          I am always somewhat amazed by statements like these:

                          - I hate new government organizations
                          - I am for small government

                          I am reminded of the scene in "Amadeus" when Salieri complains that Mozart's music has "too many notes." As with a good piece of music, a government needs as many people as it needs, and as many departments as it needs, depending on its responsibilities. To simply "not like new organizations" is a bias that fails to look at questions like, "Is it needed?" "What does it do?" and "Is it efficiently organized.

                          I hate unneccessary new government organizations. I hate government waste, of any kind.

                          BTW - statistically, the U.S. is approximately on par with the global average ratio of government employees to population. Now maybe every government in the world is bloated and poorly managed, but we are not significantly more or less so than the norm. I DO think government could be significantly streamlined. I also think Trump is the wrong person to do it. From what i can see, he cannot manage his way out of a paper bag.
                          The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

                          I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

                          Comment


                          • #28
                            Originally posted by carpedm9587 View Post
                            There's those superlatives, again.

                            Your post made me wonder - so I went digging. I found that, in a sense, that is already happening.

                            If you look at tax payment vs. return (https://www.theatlantic.com/business...takers/361668/), 14 states pay more to the fed than they get back, and 36 get more than they pay. Of the 14 that pay more than they get, seven are solidly blue (California, Massachusetts, NY, Delaware, Minn. NJ, and Ill.), five are solidly red (Kansas, Wyoming, Oklahoma, Nebraska and Utah), and two are swing states (Ohio and Colorado). When you compare these states by population, by far blue states pay more into the fed than they get back. Of the 36 that get more than they pay, 21 are solid red, 6 are solid blue, and the remaining 9 tend to swing (no pun intended). Of the top ten that get more than they give, eight are red states, one is blue (Hawaii), and the tenth is swing (Florida).

                            The numbers are pretty stark, but they tell a compelling story: it is apparently easy to have low state taxes (mostly red states), you just have to draw more revenue from the fed. States with higher taxes (mostly blue) don't draw as much from the fed and tend to be more self-reliant. And, under the new tax plan, they get penalized for it, because now the deduction for those higher taxes are capped at $10K.

                            Politically, that is a very smart (if somewhat unscrupulous) by Republicans in Washington. Blue states are unlikely to ever vote for a Republican (though they once did for Reagan in droves), so hitting them with more taxes doesn't cost the Republican party anything. Minimizing the pain for red states, meanwhile, is likely to play well with the base and lock those states in (not that they really need it).

                            The big question will be, what about the swing states?
                            Nope, gotta be done on an individual basis. State taxes to the feds include a lot more than just income taxes.

                            I fully expect the Republican Party to grow by leaps and bounds if my policy is instigated. Democrats love to talk about how we need tax increases to fund various social programs, but when it comes down to the wire, they don't actually mean THEIR taxes, just other peoples. But my plan (Vote Sparko for Prez 2020) will give them the chance to put up or shut up!

                            Comment


                            • #29
                              Originally posted by Sparko View Post
                              Nope, gotta be done on an individual basis. State taxes to the feds include a lot more than just income taxes.

                              I fully expect the Republican Party to grow by leaps and bounds if my policy is instigated. Democrats love to talk about how we need tax increases to fund various social programs, but when it comes down to the wire, they don't actually mean THEIR taxes, just other peoples. But my plan (Vote Sparko for Prez 2020) will give them the chance to put up or shut up!
                              Although the article reports primarily income tax, the linked report does not.

                              Also - did you look at the SNAP numbers below that? It shows a similar distribution: red states tend to cluster in the higher percentages and blue states tend to cluster lower down (actually, just below the midline). Again - there are exceptions, but the trend is pretty clear. Of the top 10 SNAP-using states (by percentage), nine are solidly red and one is swing. Of the lowest 10 SNAP-using states, five are solidly red (small states), three are solidly blue (including California), and the other two are swing.

                              P.S. I'm afraid I won't be able to vote for you Sparko. You have a funny hat.
                              The ultimate weakness of violence is that it is a descending spiral begetting the very thing it seeks to destroy...returning violence for violence multiplies violence, adding deeper darkness to a night already devoid of stars. Darkness cannot drive out darkness; only light can do that. Hate cannot drive out hate; only love can do that. Martin Luther King

                              I would unite with anybody to do right and with nobody to do wrong. Frederick Douglas

                              Comment


                              • #30
                                Originally posted by carpedm9587 View Post
                                I am always somewhat amazed by statements like these:

                                - I hate new government organizations
                                - I am for small government

                                I am reminded of the scene in "Amadeus" when Salieri complains that Mozart's music has "too many notes." As with a good piece of music, a government needs as many people as it needs, and as many departments as it needs, depending on its responsibilities. To simply "not like new organizations" is a bias that fails to look at questions like, "Is it needed?" "What does it do?" and "Is it efficiently organized.

                                I hate unneccessary new government organizations. I hate government waste, of any kind.
                                A) I didn't think I needed to specify that the "new government organization" had to be unnecessary - I figured that would be obvious.
                                2) Do you have any idea how many US government entities overlap with other agencies that do the same thing?

                                BTW - statistically, the U.S. is approximately on par with the global average ratio of government employees to population.
                                You say that like that's a GOOD thing!

                                Now maybe every government in the world is bloated and poorly managed, but we are not significantly more or less so than the norm.
                                I've never been much for settling for "the norm".

                                I DO think government could be significantly streamlined.
                                Absolutely! If it were run on an actual budget, like local principalities have to do, they would hire the workers they could get by with, not whoever they wanted. Or, in the case of a small company, when you find additional tasks that need done, you simply outfit an existing employee with another "hat".

                                I also think Trump is the wrong person to do it. From what i can see, he cannot manage his way out of a paper bag.
                                Yet, he's cutting regulations like crazy, and with fewer regulations, it would be reasonable to assume you need fewer regulators.
                                The first to state his case seems right until another comes and cross-examines him.

                                Comment

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