A naive question, but what's wrong with a flat tax rate?

[Bill Mattocks]

fair=equal in this context and 17% is equal when applied to EVERYONE.

I do not agree that mathematical equality is the definition of fairness in this sense.

the poor? **** the poor, almost HALF of the american people pay NO TAXES AT ALL

If there were a flat tax, they would, so I'm not sure what that has to do with anything.

THAT isnt fair.

I do not know how much money would be generated in tax revenue by taxing everyone. I presume more than is presently taken in, but how much more, I do not know. And I wonder at the effect it would have on our economy if the lowest economic group were suddenly unable to buy food or pay rent.

how is it fair to charge some NONE and some 50%?

the ONLY reason is "because they can afford it"

and that simply doesnt justify robbery in my book and more than "she was asking for it" jusitfies rape.

I don't see taxation as 'robbery'. We certainly have the means, as a society, to end taxation. We can vote it out of existence, amendments and all. Not something robbers usually put up with.

And 'because we can afford it' is often the answer I give when asked to donate to charity, or when my family wants to see a movie or go out to eat - or decide NOT to donate, see the movie, or go out to eat if the answer is that we cannot afford it. Is it not also a valid question to ask when taxing our citizens to pay for government services?

It would seem so under the current scheme, because we have a tiered tax system based on income now. So it would appear that yes, we *do* think it is fair to tax the wealthy more than the poor, at least on paper, and at least until we get all the deductions, breaks, shelters, and other methods of evading taxes legally figured in.

 

[Balrog]

A flat tax would be better than what we have now. No deductions, no exemptions.

But even better would be repealing the 16th Amendment and implementing the Fair Tax.

 

[RandomPhantom700]

Bill Mattocks:

Would a system that first negated a base, average yearly cost-of-living amount from the gross income, and then calculated tax rate off the remainder, be substantially different from the current exemption system in place?

 

[Bill Mattocks]

If Warren wants to pay more taxes, he can, shoot, he can give his whole damn fortune to the federal government.
A flat tax is claimed to be "Regressive" because it makes the poor pay taxes as well. As it stands now, 48% of Americans pay NO TAXES WHATSOEVER, were there a fair flat tax, the poor would have to pay some.
There is no nobility in poverty, if there were, poverty would be a goal.

Not entirely true, but true from a certain perspective. A lot depends on how you look at it.

This article was very prescient, and it really laid out exactly what we're looking at RIGHT NOW:

http://www.nytimes.com/2010/04/14/business/economy/14leonhardt.html

Yes, 47% of Households Owe No Taxes. Look Closer.
By DAVID LEONHARDT
Published: April 13, 2010

The answer is that tax rates almost certainly have to rise more on the affluent than on other groups. Over the last 30 years, rates have fallen more for the wealthy, and especially the very wealthy, than for any other group. At the same time, their incomes have soared, and the incomes of most workers have grown only moderately faster than inflation.

So a much greater share of income is now concentrated at the top of distribution, while each dollar there is taxed less than it once was. It’s true that raising taxes on the rich alone can’t come close to solving the long-term budget problem. The deficit is simply too big. But if taxes are not increased for the wealthy, the country will be left with two options.

It will have to raise taxes even more than it otherwise would on everybody else. Or it will have to find deep cuts in Medicare, Social Security, military spending and the other large (generally popular) federal programs.

All the attention being showered on “47 percent” is ultimately a distraction from that reality.

The 47 percent number is not wrong. The stimulus programs of the last two years — the first one signed by President George W. Bush, the second and larger one by President Obama — have increased the number of households that receive enough of a tax credit to wipe out their federal income tax liability.

...
But the modifiers here — federal and income — are important. Income taxes aren’t the only kind of federal taxes that people pay. There are also payroll taxes and investment taxes, among others. And, of course, people pay state and local taxes, too.

Even if the discussion is restricted to federal taxes (for which the statistics are better), a vast majority of households end up paying federal taxes. Congressional Budget Office data suggests that, at most, about 10 percent of all households pay no net federal taxes. The number 10 is obviously a lot smaller than 47.

But here is the kicker. None of this matters in the sense that we in the USA have to cut expenses and raise revenue. Period. We can argue about how to do that, but it has to happen. The budget cannot be (I am convinced) balanced without doing both. So. If that is true, from where does the money come? Democrats want to raise taxes and not cut benefits. Republicans want to cut benefits and not raise taxes. Neither one will work by itself. End of story.

If taxes have to go up, I am no longer as certain as I once was that ending the Bush tax cuts is the worst thing we could do. I certainly enjoyed those tax cuts and it would hurt to lose them for me. But the money must come from somewhere. DNC stubbornly insisting on taxes without cuts and GOP insisting on cuts without taxes is seriously beginning to put a burr under my saddle. Get off it, guys, it isn't working. Time for a new plan.

 

[Bill Mattocks]

Bill Mattocks:

Would a system that first negated a base, average yearly cost-of-living amount from the gross income, and then calculated tax rate off the remainder, be substantially different from the current exemption system in place?

Yes, I believe it would be very different, if I understand what you're saying properly.

 

[Bill Mattocks]

A flat tax would be better than what we have now. No deductions, no exemptions.

But even better would be repealing the 16th Amendment and implementing the Fair Tax.

There are a lot of things that would be better than what we have now. Personally, I'd like to see a national sales tax in place of a revenue tax. It would capture the money currently lost to taxation through the underground economy, and people could avoid taxation by avoiding excessive purchasing.

 

[Twin Fist]

I don't see taxation as 'robbery'.

I dont either.

I DO see taxation at rates approaching 50% as robbery

 

[Steve]

Why, then, is it OK to steal from the rich?
Close all the loopholes and watch the CPA's and Tax attorneys howl...

Ugh. Don, where did I say it was okay to steal from the rich? If someone who makes over $200,000 pays no net income tax, how is that stealing?

 

[Big Don]

Ugh. Don, where did I say it was okay to steal from the rich? If someone who makes over $200,000 pays no net income tax, how is that stealing?

Ask John Kerry. He and his wife aren't scraping by to live on his Senate salary.

 

[Nomad]

How does this:

Buffett said his federal tax bill last year was $6,938,744.

"That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable

income​

- and that's actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent," he said.

translate into the rich carrying "more than their share" as I've heard many argue of the current US tax burden? Apparently, as a billionaire, he pays less (in percentage of earned income terms) than his much less-wealthy colleagues. I'm hoping this will shut up a few of the people that claim that we're already over-taxing the incredibly wealthy and they can't afford to pay more (for example, the same percentage that I have to pay) as it would stifle the economy... but I'm sure there's another way to spin this that says exactly that...

 

[Twin Fist]

if he really only paid 17%, then close the loopholes, dont raise the taxes, when you know they will just use the loopholes in place to avoid that rate too....

 

[Big Don]

How does this:



translate into the rich carrying "more than their share" as I've heard many argue of the current US tax burden? Apparently, as a billionaire, he pays less (in percentage of earned income terms) than his much less-wealthy colleagues. I'm hoping this will shut up a few of the people that claim that we're already over-taxing the incredibly wealthy and they can't afford to pay more (for example, the same percentage that I have to pay) as it would stifle the economy... but I'm sure there's another way to spin this that says exactly that...

Pretty easily, when you see how disingenuous Buffet is being:
See Here, see here, see here.

 

[billc]

Yeah, thanks Big Don, I had heard about Buffet's do gooderism on the tax issue as well.

Here is one proposal for a flat tax that helps "the Poor" but still gets the flat tax. Exempt the first 40,000 dollars of everyones income, everything else gets hit with the flat tax. The really poor are spared, and the first 40k of the middle class is spared, and the rich still pay more.

On a side note, coming home from class I was listening to Mark levine talking about the 10 to 1 question at the republican debate, if you are interested you can look it up. He came up with a great idea, especially geared to doing what Buffet wants, increasing his taxes. Start a new "utlra-rich" tax bracket at 40 billion dollars. anyone making 40 billion dollars a year would pay 10 billion dollars in taxes, and, under the 10 to 1 question, you would get 200 billion dollars in budget cuts. An all around beautiful plan, and then Warren Buffet could stop "saying" increase my taxes, and start "paying" more taxes. Bill Gates would get it to for all the people who hate Bill Gates.

 

[crushing]

It's Robin Hood's way, don't tell me he was wrong?!

It always makes me smile when Robin Hood's way, taking from the tax collector and giving it back to the people, makes these tax discussions. Thanks.

 

[punisher73]

Yeah, thanks Big Don, I had heard about Buffet's do gooderism on the tax issue as well.

Here is one proposal for a flat tax that helps "the Poor" but still gets the flat tax. Exempt the first 40,000 dollars of everyones income, everything else gets hit with the flat tax. The really poor are spared, and the first 40k of the middle class is spared, and the rich still pay more.

On a side note, coming home from class I was listening to Mark levine talking about the 10 to 1 question at the republican debate, if you are interested you can look it up. He came up with a great idea, especially geared to doing what Buffet wants, increasing his taxes. Start a new "utlra-rich" tax bracket at 40 billion dollars. anyone making 40 billion dollars a year would pay 10 billion dollars in taxes, and, under the 10 to 1 question, you would get 200 billion dollars in budget cuts. An all around beautiful plan, and then Warren Buffet could stop "saying" increase my taxes, and start "paying" more taxes. Bill Gates would get it to for all the people who hate Bill Gates.

When I had first heard of the idea of a flat tax rate, this was how it was proposed (don't remember who I was talking with or context). That under a certain amount you wouldn't pay or would pay a lower flat rate. This way their wouldn't be a hardship on paying the taxes.

 

[Bill Mattocks]

When I had first heard of the idea of a flat tax rate, this was how it was proposed (don't remember who I was talking with or context). That under a certain amount you wouldn't pay or would pay a lower flat rate. This way their wouldn't be a hardship on paying the taxes.

Of course, this is what we have now, more or less. And it's not the definition of a 'flat tax', it's a graduated tax. The difference is that we started out with what you described above and then added tax breaks, loopholes, shelters, and all sorts of things to it, for good reasons and bad, until we have a nightmare. If we just removed all deductions and returned to the simple tax brackets we already have, we'd be fine, I think.

The problem as I see it is that lawmakers could not refrain from using the tax code for two purposes OTHER THAN generating revenue to operate the government. First, they used it to create and steer social policy; for example, by giving tax breaks on home mortgages to encourage people to buy homes rather than rent. Second, to reward those who give them money. Get rid of all tax breaks; all of them. Student loan interest, mortgage interest, having kids, etc, etc, etc. Simple tax based on income. End of story. Just rip the guts out of the tax code and leave the brackets.

 

[CanuckMA]

Here is one proposal for a flat tax that helps "the Poor" but still gets the flat tax. Exempt the first 40,000 dollars of everyones income, everything else gets hit with the flat tax. The really poor are spared, and the first 40k of the middle class is spared, and the rich still pay more.

I had to come back for a cataclysmic event.

I actually agree with Bill. :boing2:

But here's what's going to happen.

You introduce something like that, and next you'll have advocacy groups in large, expensive cities clamouring for a higher floor because of the highr cost of living. So now we'll introduce floors depending on region.
Then someone will sya,"we need to encourage retirement saving". So we'll introduce exemtion for 401(k) contributions.

And so forth...

Pretty soon we're back to the unholly mess we have now.

 

[Twin Fist]

everything above 40K taxed at a flat 17%, no exemptions, no double taxing like captitol gains and estate tax, those are BS.

bet the taxes comming in would actually go UP

 

[granfire]

everything above 40K taxed at a flat 17%, no exemptions, no double taxing like captitol gains and estate tax, those are BS.

bet the taxes coming in would actually go UP

well, those are income, too. Tax everything at 17% that comes through the door. You are already making excuses for those who can actually make a profit from selling stuff (or have had lucky/wealthy ancestors)

 

[Big Don]

everything above 40K taxed at a flat 17%, no exemptions, no double taxing like captitol gains and estate tax, those are BS.

bet the taxes comming in would actually go UP

But, then, revenue increased under the dreaded Bush Tax Cuts...