Why is the flat tax a bad idea again?

[Lone_Wolf_Moderate]

[Dr Ron]

1. What percentage?

Sometimes supporters make it sound like thier flat tax could be at the lower end of current tax rates. If so, I'm all for it. Unfortuantely I doubt this would be the case, and the actual rate would be a serious problem for lower income people.

In theory there are good aspects to it. So much money is taken out of the system for both record keeping and shelters to try to lower taxes. If this money could be recovered, then there would be some decreased need for revenue to be raised by other taxes. Unfortunately, I don't think this would be enough to keep the rate low enough in a flat tax system.

[Lone_Wolf_Moderate]

5. 20 percent?

[Jamastiene]

2. Mainly, it's because

our government couldn't keep us confused as hell every spring any more. They might have to watch their pork barrel spending and get off their asses and work. I think that's the real reason. It looks like a good idea to me, but I would want to see it coupled with living wage laws as opposed to minimum wage laws. Far too sensible and reasonable for our elected leaders to fathom.

[blogbear]

3. amen!

[Warpy]

4. Dream on

The only tax structure that has worked really well for most of the people in this country is the progressive income tax applied to individuals as well as net profit by corporations.

Remember, the nightmare we have NOW is the result of Reagan's "flatter, fairer tax" that he swore on a stack of bibles that would be so simple we could send it all in on a postcard.

Congress has so burdened the tax code with sweetheart deductions for fat cat contributors (and themselves in the process) that we're going to have to start all over again and soon.

No tax that falls 100% on the subsistence income of working people can be called fair in any sense of the world. That means a flat income tax and that means a sales tax. Both eat into piss poor wages that don't support a worker now, let alone a family.

[bemildred]

6. When we have flat income for everyone, we can have a flat tax too.

[Warpy]

7. There you go

that's the only way a flat tax can be a fair tax.

[bemildred]

8. I will never understand people that make $350K a year say,

and think they are getting screwed, let alone people that are
actually wealthy.

[dcfirefighter]

9. If you want real Progress

You have to think of a different Zebra.

Why tax incomes at all? The rich giggle to themselves on this one, I'm sure. What is income? The IRS doesn't know. They piss and moan about the 35% rate, but the point is, they wouldn't really care if it was 50% or even 80%, because they aren't taxed on capital gains until they sell. And when they sell, they get some high-dollar tax lawyer to figure out how to make it look like a loss.

What we need to do is tax wealth.

Tax wealth, not work!

Of course, the economists will tell you, if you tax wealth, you lose the incentive to produce wealth, and the economy falls apart. They may be right. So lets tax that wealth that can't be produced: Land. Air. Airwaves. Airways. Mineral Wealth. Fisheries.

By any code of morality, a man is his own property. By extension, his labor is his and his alone to sell. Noone has a right to coopt the worth of his labor, or that which is the product of his labor.

Funny thing about markets is: when you take the tax of something, people use more of it. Each and every one of us is obviously willing to work for our take-home pay. Becaus of taxes, each of our employers must pay 33-50% more than that to employ us. Consider how many more people would be employed if there was a 33% off sale on labor. Then, take the next logical step and ask, gee, what happens to my salary when all these companies are looking, begging, for good help?

And with all these people having jobs & decent income, don't you think that they'll want to buy some things? They always do, human desire is boundless. Guess what? Someones going to get a job making those things.... the cycle continues, wealth upon wealth for all, and end to poverty, war, famine, etc.

We just have to tax (natural) wealth, not work.

PS - the distribution of wealth is far far more skewed than income, a flat tax on it is inherently progressive, but a small personal exemption wouldn't hurt either.

[stevebreeze]

10. would you rather try to live on 70% of $ 10K or $1.7 million?

coincidentally $1.7 is what Chaney squeaked by on last year.

[LiberalFighter]

11. Would you want to pay 20%??

or 9.95%?

My effective tax rate for 2004 is 9.95% on adjusted gross income.
On all income it is 8.34%. (My 401k is included)


How many would be paying a higher tax if it becomes a flat tax? Anyone here that is paying 20% or more right now?

[IrishDemocrat]

12. I would be hurt with a flat tax as well.

My effective rate was 11.7%, marginal at 15%. I would say at 20% flat or 25% consumption I would be hurt as well. Finally, a Packers fan I agree with!

[LiberalFighter]

14. Another throwback at those that argue low-income that don't pay taxes

Everybody gets exactly $3,100 per exemption they are allowed to claim.

If a filer with a family of 4 files Married filing jointly and takes the Standard Deduction earns $22,100 they will have taxable income of $0 because 4 exemptions =12400 +$9700 for Married filing jointly status.

If a filer with a family of 4 files Married filing jointly and takes the Standard Deduction earns $50,000 they will have taxable income of $27,900 because 4 exemptions =12400 +$9700 for Married filing jointly status.

They both have the same Standard Deduction of $9700 and they both will have exemptions totaling $12400 for the 4 exemptions.

The family with an income of $50,000 will have taxes of $3466 or 12.42% of gross income. If the total income was taxed it would be $6789 or $13.58.

Many people are under the impression that if someone is in the 25% tax bracket that all of their taxable income is taxed at that rate. That is not true. Wealthy and Republicans want the general public to believe that.

Married Filing Jointly Tax Bracket
If taxable income is over-- $0
But not over-- $14,300
Tax is: 10% of the amount over $0

If taxable income is over-- $14,300
But not over-- $58,100
Tax is: $1,430.00 plus 15% of the amount over 14,300

If taxable income is over-- $58,100
But not over-- $117,250
Tax is: $8,000.00 plus 25% of the amount over 58,100

If taxable income is over-- $117,250
But not over-- $178,650
Tax is: $22,787.50 plus 28% of the amount over 117,250

If taxable income is over-- $178,650
But not over-- $319,100
Tax is: $39,979.50 plus 33% of the amount over 178,650

If taxable income is over-- $178,650
But not over-- No Limit
Tax is: $86,328.00 plus 35% of the amount over 319,100

[EVDebs]

13. Read Chapter 7 of Perfectly Legal. We already HAVE flat taxation

When you add up Fed, State, Local taxes we have around a 20% flat tax already. It's regressive and it's inequitable. It favors corporate entities and the wealthiest at the expense of everybody else.

[LiberalFighter]

15. Corporations/Businesses do NOT pay taxes.

They pass those taxes onto the consumers.

[dcfirefighter]

16. Not exactly

Corporations pass taxes on productivity on to consumers.

It is impossible to pass taxes on natural wealth on to consumers.

You pay it already, it is enjoyed as a surplus profit by its owners. Taxing it does not enable them to raise prices, if they are in a competitive industry.

A tax on production does raise prices, because all producers must pay it.

A tax on land value does not raise prices, because not all producers occupy the same land value.

http://www.landvaluetax.org/nopasson.htm

[EVDebs]

17. Most companies paid no taxes during the boom

http://moneycentral.msn.com/content/Taxes/P80242.asp

""...More than 60% of all U.S. companies paid no federal tax at all during the boom years of 1996 to 2000, the General Accounting Office reports.

In 2000 alone, 94% of all U.S. corporations paid less than 5% of their total income in corporate taxes, the GAO said in a report released Friday. Among the largest corporations -- the 1% of all corporations that owns 93% of all corporate assets -- 82% paid less than 5% of their income in taxes.

And it wasn’t just American companies avoiding a bill. About 70% of foreign-owned companies doing business in the United States paid no federal tax in the late 1990s, the GAO said. The GAO report covered 2.1 million returns by U.S. companies and 69,000 foreign-owned companies""

And remember Warren Buffett's quote from commondreams.org's
Warren Buffett Urges Higher Corporate Taxes
www.commondreams.org/headlines04/0306-01.htm

""Corporate income taxes in fiscal 2003 accounted for 7.4% of all federal tax receipts, down from a post-war peak of 32% in 1952. With one exception (1983), last year’s percentage is the lowest recorded since data was first published in 1934. Even so, tax breaks for corporations (and their investors, particularly large ones) were a major part of the Administration’s 2002 and 2003 initiatives. If class warfare is being waged in America, my class is clearly winning.""

Winning, by a mile it seems !