What are the major tenets of your ideal tax plan?

[Squatch]

Let's say you are given the power to rewrite the US tax code. But, your boss wants a read-ahead powerpoint presentation on the major changes you are going to be making. He wants to know how you are going to levy and collect taxes in the following areas:

1) Income
2) Purchases
3) Luxury items (like cars, etc)
4) Social Security
5) Medical
6) Private investments
7) Other

[bluestateguy]

1. Taxes

1)Income
Nobody making under $50,000 pays taxes. Repeal all Bush tax cuts for the wealthy and add a surtax for Americans making over $1,000,000. Raise corporate taxes through the absolute roof. Massive tax penalties for companies that outsource overseas or move jobs overseas. Repeal NAFTA and GATT. Bring back tariffs. Make churches pay taxes.

2) Purchases
Sales taxes on household necessities (toilet paper, toothpaste) are abolished. Sales tax deduction for people making under $50,000 a year.

3) Luxury items (like cars, etc)
Only on items with outrageous appraised values, and second homes.

4) Social Security
SS income should not be taxed at any level

5) Medical
I'd just have Canadian style health care, so medical deductions would not be needed.

6) Private investments
1% tax on stock trades

7) Other
No tax audits on people making under $100,000 unless there is clear and compelling evidence of wrongdoing.

Allow Americans to check off on their tax forms which government programs and agencies they wish to direct their tax money to.

[SoCalDem]

2. first 50K of PAYROLLED income is exempted..n/t

[Sammy Pepys]

3. Generally....

1) Broader tax brackets, with incomes below the $20-$25K ($40-$50K joint) range exempt from any federal income taxes.

2) Higher income thresholds and contribution limits for IRAs.

3) Higher contribution limits for 401(k)s.

4) Elimination of the AMT.

5) Some sort of tax benefit or tax deduction for starting a savings account/money market fund etc. Haven't quite figured out how this would work...maybe an available deduction of up to $500 for the purposes of starting an account (and provided it's not drawn upon during that year)....I don't know..haven't worked the kinks out on this one.

I'd keep everything else more or less the same probably.

[SoCalDem]

4. #4...AMT maybe? I like ATMs

:)

[Sammy Pepys]

5. yup...just caught that! doh!...n/t

...

[oscar111]

6. moved nt

zzz

[Sammy Pepys]

8. It would bankrupt the country even more than that, though.

One beef I had with Clark...besides the fact that a measure like that had little to no chance of succeeding.

Taxing just the wealthy severely limits the tax base.

[oscar111]

10. moved nt

[Sammy Pepys]

13. How many people in America...

...make between $50K and $100K per year, and how many make significantly more?

More?

Less?

Same?

[boobooday]

7. My Tax Plan

First of all, I want to discuss spending priorities. Then I will know how many tax dollars really need to be collected.

My priorities would be:

Universal health & dental coverage
Top-notch education from pre-school up
Environmental clean-up
Infrastructure investment

Now, where does this money come from? Well, we could start by asking people like Duke Cunningham, and former President Bush, and Dick Cheney. This is where our tax dollars are going right now. Ending this evil corruption (how much of our economy relies on the production of killing technologies?) would mean finding billions of dollars for the above priorities.

As for collecting taxes, end the loopholes that the wealthy individuals and corporations use to avoid paying their share.

[BlackHeart]

9. Please don't screw up again with the luxury tax

It may seem like a way to punish people who have excess money to spend but in reality it affects the worker who makes the luxury items, often times union workers.

[oscar111]

12. they can make useful item, not luxury items nt

zzz

[BlackHeart]

18. Well thought out reply...

...Not. I believe the last time the luxury tax scheme was dragged out it hit yachts over $100,000, as one example. People quit buying boats in that price range and many workers were put out of jobs. No alternate jobs were made available for them. I have no pity for a millionaire that can't have his yacht but I do feel for the workers that were unemployed.

[oscar111]

21. it is like saying the Mafia employs hit men

so let us never get rid of the mafia

Luxury items are not a good source of jobs

but i will mull over your reply, and may end up agreeing.

help me figur out where money might employ the new jobless....

[BlackHeart]

22. Let's say I've got a hundred grand profit...

...on a stock I purchase; I'm thinking about buying a yacht but your luxury tax just added $10,000 to my purchase so I change my mind.
My money stays in the stock market. No job created.

[dcfirefighter]

33. Who decides what is luxury and what isn't

I'm sure those lobbyists would love it.

Is a $2000 guitar a luxury item, when a $500 one would do?
Is a $500,000 home a luxury item, when a $150,000 one would do?
Are all pleasure boats luxury items, or just the ones over a certain amount?
Are jeweler's jobs not good jobs? How about fine furniture craftsmen? Certainly having a $10,000 recycled oak armoire is luxury, when a $100 recycled pressboard one would function just as well.
Is a $5000 painting a luxury? Certainly you could make the argument that purchased art is a luxury. Are artist's jobs not worth having?
How about a $100 bottle of wine? Is a vintner's job not worth having?
Is a job on the Cadillac line less beneficial than one on the Chevy line?

There's no place for a luxury tax - if you want to tax people for 'taking' more than their 'fair share' you need to hit the 'taking' directly: pollution charges, resource depletion charges, resource occupation charges, etc.

[dcfirefighter]

15. hear hear. Luxury taxes don't work. nt

[lastliberalintexas]

25. Yes, any consumption/sales based tax is a bad idea

Even if it only applies to "luxury" items.

Taxes on inheritances over $1 million, unearned income and capital gains should be taxed the most, with taxes on earned income at a fraction of what it is today.

[RDU Socialist]

11. Okay

1. I believe in a progressive version of the flat tax. This means a higher percentage of taxation on income which can be taxed. This also includes high tax credits so the poor won't pay any taxes at all. Here is how it would work:

Base %: 35%
Tax Credit per Adult Dependent: $15000
Tax Credit per Child Dependent: $8000

For a couple making $100k a year with three kids their taxes would look like this

Incomes: $100,000

Tax Credit (Adult): $30,000 (2 x 15k)
Tax Credit (Child): $24,000 (3 x 8k)
Total Tax Credit: $54,000

Income - Tax Credit: $46,000

Amount Owed in Taxes: $16,100.

Yes 16% of their income is lower than what they would pay now probably, however things like social security, and medical coverage would be covered by other forms of receiving government revenue like tariffs, and taxes on social security and national healthcare.

2. I hate sales taxes because those who spend a greater percentage of their income pay more of their income in sales taxes. A person who makes $20,000 a year probably has to spend on goods like food, clothing, etc. between 6000 and 12000 dollars. Someone who makes 100k per year doesn't spend nearly as high a percentage of their money on goods which can be sales taxed.

3. Luxury items should be taxed fairly. Basically 1% of what your luxury item is worth, and luxury items should be limited to modes of transportation, housing, and land.

4. Social Security should have a higher income cap for taxes to be taken out. $93,000 is too low, it should be $1 million.

5. 3% of everyone's income should go to a national healthcare pool which would partially (not fully) fund a universal system. If the average income is really around $45000 a year, and there are approximately 150 million workers, that would put in $202,500,000,000. This is 200+ billion dollars spent more wisely than, say, going to war with a country who was no threat to us.

6. Things like life insurance, stocks, etc. should be included in one's income, which I explained above.

[dcfirefighter]

14. NO TAXES

Just market rate fees for enjoying a government granted privilege, like a monopoly or the ability to use our air as a Carbon Sink.

1) I'm not
2) I'm definitely not
3) I'm not
4) I'm not. The federal payroll tax raises the cost of labor by 15.3%, causing a large proportion of unemployment
5) I'm not
6) I'm not
7) I will raise the entirity of taxation by:

A) State and Local property taxes against land values (which bears not at all on labor), hopefuly at or near full rental values
B) Federal, by watershed, taxes against groundwater pollution
C) Federal taxes against air pollution, including a hefty Carbon tax
D) Federal auctions of patent protection after the original filer has it for 10 years
E) Federal auctions of FCC spectrum
F) Federal auctions of timbering, mining, driling, fishing, grazing rights (at sustainable rates)
G) Not really a tax, but I'd eliminate the Fed, remove banks rights to fractionally reserve banking, and print my own money
H) Federal congestion charges / auctions of the highway system, airways, or newly federalized railways.
I) Federal auctions of immigration rights (many, many, slots each year. Better pay us than coyotes)
J) State and local auctions of utility privilege

All told, such taxes, fees, and auctions could probably raise nearly $4 Trillion today - and that's in the face of $4T worth of mostly harmful current taxes. Remove those current taxes, and it'd raise probably $6T trillion, though a larger proportion of it would be at the state & local levels - fine by me, I prefer decentralization.

If the combination of governments continued to spend $4T a year, and I don't think they should, that would leave $2T left over. Rather than reduce 'taxes' which would allow private entities to collect the public commonwealth & socially created wealth, I'd return equal shares to each citizen. At current gov't spending levels, this would be $6,666 per person. I believe this is high enough to phase out SS, which would bring the per person dividend to $8333. The change in the monetary system would also eliminate the national debt, and payments on it, which would bring the dividend to $9333. Cut the military budget in half and it's over $10,000 a person.

Currently, if you look at the nature of employment, it is in a business's best interest to minimize labor costs. But labor costs are artificially high due to taxation, as are returns on labor. Eliminating those particular bad taxes would increase the amount available to pay for labor while also increasing the portion of pay taken home. All told, what would happen is that instead of minimizing labor inputs, producers would minimize ecological footprint.


So, in my world all your purchases and your wages & salary would be untaxed.
Labor would be in such demand that 1) anybody could work 2) wages would be far above current wages 3) probably the workweek would decrease.

I believe unemployment would be <1%, just those moving from job to job. There may be a larger group of people who choose simply to not work, and live simply of of their Citizen's Dividend and savings - early retirees if you will
I believe that median household income would increase nearly 50% to $65,000 or so. (On top of the Citizen's dividend of $30,000 per family of 3)
I believe that real estate prices would stabilize - eliminating the home as source of income, but making homeownership accessible to nearly everyone.

You'd buy water from a utility as you do now, but your community would share in the monopolistic profits therefrom
You'd buy food from farmers who would more likely be small, close, and organic
You'd buy clothing more likely produced from domestic fibers on domestic machines, if not actually tailored by a local tailor
You'd buy a house and never pay property tax on it. Construction costs would probably drop 25%
You'd buy a lot for your house, but instead of paying $5000 a year to the mortgage company, you'd pay $5000 a year in taxes

[Rufus T. Firefly]

16. No tax on unemployment benefits.

Or any government assistance.

No annual cap on social security tax (you pay SS tax on all you earn, instead of it capping at around $60,000 in SS tax last time I checked).

Treat corporations as regular citizens, as a corp. is supposed to legally be a person. You earn $20 billion, you pay taxes on that $20 billion. Not on "profit" - on INCOME.

[dcfirefighter]

17. Individuals only pay income tax on 'profit'

As they may deduct living and business expenses, similar to corporate incomes. You just need a better lawywer. OH, and to make corporations pay the same rates as individuals, our top rate is 35%, theirs is 20%, i believe.

[Rufus T. Firefly]

28. Some of us can't afford lawyers.

And have to do our own taxes.

[dcfirefighter]

32. Me too. but thats the way the system has to work...

as long we try and determine what is 'good' income or 'taxable' income; 'good' property or 'taxable' property; 'good' purchases or taxable purchases.

Lawyers and Lobbyists will always manipulate such systems.

Which is why I support the eventual elimination of income, property, and sales taxes, and their replacement with Land Value Taxes, resource use auctions, utility monopoly privilege auctions, and pollution charges.

The distribution of incomes is skewed: a small percentage receives a very large portion of incomes. The distribution of privileges and land values is even more skewed. A tiny percentage of owners owns the vast majority of value. A 'flat' tax on land values would be, by it's nature, very progressive.

Put another way, any tax on incomes, and not wealth, will always leave the advantage to the Haves; while the Have Nots attempt to better their position in life, their efforts are taxed. However, a tax on wealth, removes some of the value and desirability of the very products that the working class must provide to earn income. Fortunately, this effect does not apply to all wealth, only those forms of wealth that are created by humanity, by labor. The vast amounts of natural wealth and socially created wealth may be redistributed socially without ANY infringement on productivity.

[Squatch]

19. Tax on income would just be treated as a cost of production

therefore, the cost of taxes to corporations would be passed to consumers.

[BlackHeart]

20. Another well thought out reply...

Not!
"You earn $20 billion, you pay taxes on that $20 billion. Not on "profit" - on INCOME."

What is the top tax bracket now 35%? How does a corporation that works with a smaller profit margin stay in business?

[Rufus T. Firefly]

27. Corps are supposed to be the same as individuals.

So they get the benefits of that, but not the responsibilities?

I pay taxes on my income. The Feds don't care whether I spent it all on housing and food and health care for my family.

[BlackHeart]

31. If you don't let

corporations have deductions you kill them.

For example: I buy a product from you for 90 cents that I re-sell for a dollar.
I now have a dollar income but I only made 10 cents on the deal. How do I stay in business if I have to pay 35 cents in taxes each time I make 10 cents?

[Sammy Pepys]

23. You'd drive businesses right into the ground....

Particularly small businesses.

[Radio_Guy]

24. Not as well-versed in taxes as some

But here goes:

1) Income - No income tax on < $50,000 single and $100,000 married filing jointly. An additional 10% on each successive $50,000/$100,000 until 70% on those making $350,000 single/$700,00 joint and up.

2) Purchases - Eliminate all sales taxes on food and medicine

3) Luxury items (like cars, etc) - A small tax on luxury items, maybe 1/2 of the sales tax.

4) Social Security - Mandatory for everyone, even Bill Gates pays 7.5%. But a maximum income to take any out. If you make > $1,000,000 a year, you don't need SS. That money then goes to those barely able to scrape by.

5) Medical - Not taxed. People pay way too much for medical care as it is.

6) Private investments - A graduated capital gains tax mirroring income tax. Same scale.

7) Other - I agree with bluestateguy. No tax audits on people making under $100,000 unless there is clear and compelling evidence of wrongdoing. Innocent until proven guilty.

[Neil Lisst]

26. 1. Exempt first $40K per year

2. Fund social security through consumption tax, not income related tax
3. Reduce taxes on $40K to $100K
4. Impose 20% consumption tax on luxury items, Hummers, botox, plastic surgery

[TahitiNut]

29. Some thoughts ...

General principle: The expenses of government should be borne in proportion to the economic benefits derived therefrom.

Income:

• Income derived from one's own labors and personal services (wage and salary income) will be taxed at the lowest rates up to the annual salary level of the President of the United States. Wage and salary income above this will be taxed at a rate equal to the Gini Ratio of Family Income in the US, expressed as a percentage (currently 45%), of the calendar year preceding the beginning of the tax year. Wage and salary income below the defined poverty level will receive an income tax credit equal to 80% of the difference between that income and the defined poverty level for the tax year.
• Taxes on dividend income and corporate profits will be assessed at a rate equal to the Gini Ratio of Family Income in the US, expressed as a percentage (currently 45%), of the calendar year preceding the beginning of the tax year.
• Taxes on net capital gains, adjusted for inflation using the national CPI, will be assessed at a rate equal to the Gini Ratio of Family Income in the US, expressed as a percentage (currently 45%), of the calendar year preceding the beginning of the tax year.
• Interest income, adjusted for inflation, will be taxed at rates equal to wage and salary income.

Purchases: A Federal Tax will be assessed at a rate of 2% on all sales or exchanges of corporate stock, including all exercises of stock options.


I don't see a significant Federal tax issue on the other items. Social Security Taxes (insurance premiums, actually) are a whole 'nother subject, imho.


It seems to me that a top marginal tax rate (a tax on the entitlements of the most-benefitted) equal to the Gini Ratio might serve as a terrific incentive to achieve a far more equitable economic system. For reference, here's a graph of the US's Gini Ratio over the years ...

[DUHandle]

30. Redefine what a non profit is and

Non profits are used to direct money into political activities.

Not all of them, but enough of them to lessen the amount of tax collected. I’d like to see a redefinition that would increase tax revenue.


And, I’d like to see a change in tax audit patterns, where higher income people are most likely to be subject to audit.