How Do You Like This Tax System?

[nc-1701]

Ok after thinking about taxes somewhat I realized what we need is something that is neither progressive or regressive, as both of these are bad, and it needs to be simple So here's my idea: Basicaly we set taxes as a flat percentage rate, exactly what that rate is can be changed depending on the amount of revenue you have. The point is it's flat rate so everyone pays exactly the same rate, you will not be penalized for being rich.

A bottom will also be placed on it $30,000 will be exempted from taxes so anyone making less than 30k pays zero taxes, an additional $15,000 deduction will be added for each dependant. So family of four one parent working would have a non-taxable income of $75,000.

The actual numbers here can all be fudged a bit, but the point here is the poor don't have to pay any taxes. The government makes little off of them anyway. The wealthy, and mid-high middle class do pay a flat rate after taking home a signifigant amount completely tax-free. There are no other tax breaks, to keep tax laws nice and simple

So what do you think?

 

[sysyphus]

Are there any other reductions avaible? E.g. retirement savings, charitable donations? These are important deductions for people at all levels of society.

Doesn't really sound too different from the system we have now, except that the figures have changed.

 

[nc-1701]

The point is it's flat rate to keep the uber-conservative types happy, and has a nice free bottom to protect the poor.

 

[JollyRoger]

If you exempt so much income from taxation, then your flat rate will be high and you will hear the same arguments of how the tax system is unfair to the rich since Joe Family man is paying 0% and Joe Millionaire's marginal rate is 40 or 50 percent or more. If you notice, Bush's "across-the-board" tax cut gave only a $300 dollar tax cut to a very large swath of the blue collar working class. The reason the 15% bracket was the only one that only received a partial tax cut is that the government needs to tax in the $10,000 - $80,000 range. If nobody gets taxed on anything in that income range, then your starting flat tax rate once you start taxing is going to be very high.

 

[Brighteye]

Why is a flat percentage fair? If you want to appease people, charge everyone the same amount, whether rich or poor. The government does the same work for everyone.

 

[JollyRoger]

Why is a flat percentage fair? If you want to appease people, charge everyone the same amount, whether rich or poor. The government does the same work for everyone.

No it does not. The wealthy take a disportionate advantage of the court system and law enforcement designed to protect wealth.

 

[Mark1031]

No it does not. The wealthy take a disportionate advantage of the court system and law enforcement designed to protect wealth.

That and everything else including government, education, defense. That is why a highly prograssive tax is appropriate.

 

[LucyDuke]

The point is it's flat rate so everyone pays exactly the same rate, you will not be penalized for being rich.

It's not exactly the same rate at all. A single guy making 100K a year is paying a much higher rate than a family of four making 60K a year.

That and everything else including government, education, defense. That is why a highly prograssive tax is appropriate.

Rich folks who send their kids to private high schools pay just as much as anyone else into the public education system and take very little out of it.

 

[mrt144]

which is why any arguement towards "you should put in what you get out" is ridiculous. There are times where the collective good is met by spreading the costs to everyone.

 

[Perfection]

The point is it's flat rate to keep the uber-conservative types happy, and has a nice free bottom to protect the poor.

Ha, you'll never ever please everyone, don't try.

 

[sysyphus]

Ha, you'll never ever please everyone, don't try.

It's kind of like muzak. Since it's impossible to find any kind of music that everyone will enjoy, restaurants, call centres and other businesses deliberately pick the most awful music they can find so that everyone is equally disgusted.

They figure that if they can't please anyone they might as well at least do what they can to expedite you and your annoyingly high standards away from them as soon as possible. Government basically works the same way.

 

[bhsup]

Exemptions are way too high. Otherwise, I'm a huge fan of the flat tax.

Why is a flat percentage fair? If you want to appease people, charge everyone the same amount, whether rich or poor. The government does the same work for everyone.

Um, that is exactly what a flat taxdoes. Everyone gets charged the same. Bill Gates and I, both charged 10%. That would be awesome.

 

[Whomp]

In 2004, 42.5 million tax returns – one-third of all returns filed – had no income tax liability because of the available credits and deductions in the tax code.

Here's the closest I can come for distribution of tax paid by income level.
You'll need to start by making this as close to revenue neutral as possible.
The less than 10% of the people making $100k+ paid in 62% of the tax.
http://www.taxpolicycenter.org/TaxFacts/TFDB/TFTemplate.cfm?Docid=217

If you do nothing we already have a flat tax with AMT rates at 26% and 28%. I doubt the politicians want to relinquish their control on deduction, though.

 

[GoodEnoughForMe]

No it does not. The wealthy take a disportionate advantage of the court system and law enforcement designed to protect wealth.

The poor take money through welfare (among other things). The elderly take it through Social Security. We all take it, so ideally, if nobody has to pay more, nobody should have to.

 

[mrt144]

The poor take money through welfare (among other things). The elderly take it through Social Security. We all take it, so ideally, if nobody has to pay more, nobody should have to.

if you look at the proportional benefit that the government provides in defense, the rich take proportionately more benefit.

The defense of 3 Billion dollars in assets a year is worth more than the defense of my 2400 dollars in assets a year. The government spends more money, and has more to gain in defense of the rich if they can levy higher taxes against them than they do against me the individual.

Thats why I see little problem in regressive taxes.

 

[Little Raven]

Thats why I see little problem in progressive taxes.

Fixed that for ya.

At least, I hope I did.

 

[JollyRoger]

The poor take money through welfare (among other things). The elderly take it through Social Security. We all take it, so ideally, if nobody has to pay more, nobody should have to.

Social Security, as set up, advantages higher income white women as they are likely to live longer and benefit to greater extent compared to what they put in (in terms of Social Security taxes). A guy making minimum wage pays Social Secutity tax on every single dollar he makes while Bill Gates pay social security tax on only his first $85,000 of the millions he makes per year, so if you want a flat tax, then the rich should have to pay Social Securit taxes on every dollar, just like Joe Six Pack.

 

[mrt144]

Fixed that for ya.

At least, I hope I did.

thanks! I did jumble the two.

 

[ComradeDavo]

I support removing poor people from taxes all together, but I think high earners should pay more than middle earners.

 

[CIVPhilzilla]

Abolish income tax, and rely on the government's best form of taxation: the lottery.