Whats wrong with a flat tax?

[nehalem256]

What is wrong with it is that it still taxes the wrong thing......income.

Well the problem is the alternative is a sales tax which is inherently regressive. As well as discouraging consumer spending which you may have noticed is a pretty big part of the economy.

 

[Incorruptible]

The people that are against the flat tax just want the rich to pay more for their social programs, the rich pay enough tax and they conveniently forget 50% of Americans dont pay taxes

 

[JACKHAMMER]

The people that are against the flat tax just want the rich to pay more for their social programs, the rich pay enough tax and they conveniently forget 50% of Americans dont pay taxes

Don't pay federal income tax you mean, they still play plenty of other taxes. I am not a huge fan of many of our social programs, but still have the understanding of why a flat tax is regressive.

 

[nehalem256]

The people that are against the flat tax just want the rich to pay more for their social programs, the rich pay enough tax and they conveniently forget 50% of Americans dont pay taxes

There is no reason you cannot cut social programs and still have a progressive tax system.

 

[a777pilot]

Well the problem is the alternative is a sales tax which is inherently regressive. As well as discouraging consumer spending which you may have noticed is a pretty big part of the economy.

I also want to do away with annual property taxes.

I want to replace both with a sales/consumption/transfer tax with NO exceptions.

If buy a loft of bread....pay a tax.

Buy a car....pay a tax.

Buy a home....pay a tax, then no annual property tax.

Buy sctocks....pay a tax.

Buy an entire company....pay a tax.

Transfer money off shore....pay a tax.

In other words any thing bought, traded or transferred is taxed.

ALL income and profit is never taxed. Private real property is never taxed on an anual basis.


What's wrong with that?


Yes, I know it will never be, but taxing income, profit and private real propert is just un-American.

 

[a777pilot]

The people that are against the flat tax just want the rich to pay more for their social programs, the rich pay enough tax and they conveniently forget 50% of Americans dont pay taxes

I agree that therich pay most of the taxes but you must remember that when you say 50% of Americans don't pay taxes, it's just income taxes. They do pay other taxes.

 

[nehalem256]

I also want to do away with annual property taxes.

I want to replace both with a sales/consumption/transfer tax with NO exceptions.

If buy a loft of bread....pay a tax.

Buy a car....pay a tax.

Buy a home....pay a tax, then no annual property tax.

Buy sctocks....pay a tax.

Buy an entire company....pay a tax.

Transfer money off shore....pay a tax.

In other words any thing bought, traded or transferred is taxed.

ALL income and profit is never taxed. Private real property is never taxed on an anual basis.


What's wrong with that?


Yes, I know it will never be, but taxing income, profit and private real propert is just un-American.

I like your transfer money off shore tax.

But I think you are going to have serious problems with your home sales tax and stock sales tax. As in people will now have to take out bigger loans to pay for your sales tax on homes. A a stock sales tax will seem to destroy market liquidity

 

[Incorruptible]

I agree that therich pay most of the taxes but you must remember that when you say 50% of Americans don't pay taxes, it's just income taxes. They do pay other taxes.

Which is the way it should be, the income tax should be replaced with some kind of consumption tax. The government has no right to tax peoples income.

 

[bfdd]

I'm also not very much a fan of taxing income, I think we should tax consumption. Though I believe the Federal Government should shrink in size and responsibility as well. So whatever.

Just an interesting tid bit for those in this thread, we just pushed through a huge flat tax law. The ACA now that it's considered a tax is just that. Pay a flat tax or buy health insurance and get a deduction.

 

[Linux23]

If I made $1,000,000 a year in income, shit yeah i'd be happy to pay 50% of my income as taxes.

 

[Linux23]

If you tax consumption, then it would definitely be more of a burden on the poor as they consume more.

 

[a777pilot]

If I made $1,000,000 a year in income, shit yeah i'd be happy to pay 50% of my income as taxes.

No you would not!

 

[a777pilot]

If you tax consumption, then it would definitely be more of a burden on the poor as they consume more.

No they do not.

The rich consume tons more than the poor.

What you trying to say is that the tax they would be paying would be a greater percentage of their income.

To that I say, so what?

 

[nehalem256]

No they do not.

The rich consume tons more than the poor.

What you trying to say is that the tax they would be paying would be a greater percentage of their income.

To that I say, so what?

So you admit that a consumption tax is regressive.

 

[a777pilot]

So you admit that a consumption tax is regressive.

I am not advocating a consumption tax. I want a sales/consumption/transfer tax, plus the elimination of all annual taxes on private real properties.

It's not regressive at all. You pay taxes on what you purchase, use, trade or transfer to others or transfer out of the economy.

 

[a777pilot]

Example: If Mr. Buffet wants to buy $400 million of BoA stock, then he ought to pay a tax on that purchase, up front. what's wrong with that? If he sells that stock the next day or ten years from now all the profit and/or income from that purchase is totally tax free.

 

[ShawnD1]

Example: If Mr. Buffet wants to buy $400 million of BoA stock, then he ought to pay a tax on that purchase, up front. what's wrong with that? If he sells that stock the next day or ten years from now all the profit and/or income from that purchase is totally tax free.

Uhhhh because it would grind the economy to a hault? If the government is going to take a solid 10-20% cut out of your stock purchase, that means you can't reasonably expect to make a profit for several years. Instead of doing stock purchases in the US, they would all move to foreign countries.

The people that are against the flat tax just want the rich to pay more for their social programs, the rich pay enough tax and they conveniently forget 50% of Americans dont pay taxes

The only "fair tax" is no tax at all. You work at Wendy's and you want your kid to attend school? That'll be $5,000 cash up front. You're Bill Gates? That'll still be $5,000 to attend the same school. Same school - same education - same cost. Of course we don't do that anymore because people figured out more than 100 years ago that having a very large percentage of uneducated and illiterate people screws up the economy. Something simple like finding a person who can manage a McDonalds becomes a challenge because so few people can do things like read, write, or do basic math.

 

[a777pilot]

Uhhhh because it would grind the economy to a hault? If the government is going to take a solid 10-20% cut out of your stock purchase, that means you can't reasonably expect to make a profit for several years. Instead of doing stock purchases in the US, they would all move to foreign countries.

First it would not, repeat, NOT be anywhere cose to 20%. Besides that, what is wrong with a little long term investing? Also, under my plan, if those that didn't like this system wanted to more their assets/money out of this country, then it would be taxed as it leaves.

 

[piasabird]

You pay income tax on income. Stock is worth nothing until you sell it. You can purchase stock and have a loss. The capital gains tax is a tax on gains. A stock is an investment, not a purchase. when you say purchase stock it has a more deeper meaning. It is like buying a loan. It is not worth anything unless someone pays off their loan.

 

[a777pilot]

You pay income tax on income. Stock is worth nothing until you sell it. You can purchase stock and have a loss. The capital gains tax is a tax on gains. A stock is an investment, not a purchase. when you say purchase stock it has a more deeper meaning. It is like buying a loan. It is not worth anything unless someone pays off their loan.

When you "invest" in a stock does money change hands?

If it does, then under my plan it would be taxed.

Sure would keep the speculators at bay.

 

[silverpig]

First it would not, repeat, NOT be anywhere cose to 20%. Besides that, what is wrong with a little long term investing? Also, under my plan, if those that didn't like this system wanted to more their assets/money out of this country, then it would be taxed as it leaves.

You would kill all short term investing. Like it or not, it's a decent chunk of the market.

Even if it's a 1% tax, that would kill anything shorter than oh 1 day or so.

 

[silverpig]

When you "invest" in a stock does money change hands?

If it does, then under my plan it would be taxed.

Sure would keep the speculators at bay.

Your plan also de-links certain services and the things they serve.

Property tax goes to fund services to maintain that property - garbage collection, local road maintenance etc.

 

[a777pilot]

Your plan also de-links certain services and the things they serve.

Property tax goes to fund services to maintain that property - garbage collection, local road maintenance etc.

Why is that the only way of collecting revenue for these services? It also says that the government owners your property. Don't think so. Just try not paying your property taxes and see what happens.

I get a water bill every month for my home usage. If I don't pay it my water is turned off. The local government entity does not put my property up for sale.

 

[nehalem256]

You would kill all short term investing. Like it or not, it's a decent chunk of the market.

Even if it's a 1% tax, that would kill anything shorter than oh 1 day or so.

Not only is it a decent chunk, but it is essential to providing market liquidity.

Perhaps you remember what happened the last time liquidity dried up in a financial market?

 

[a777pilot]

Not only is it a decent chunk, but it is essential to providing market liquidity.

Perhaps you remember what happened the last time liquidity dried up in a financial market?

That was not the problem. That was the effect of the problem.

In my plan speculation would be lowered, not eliminated. Volatility would be dampened. Both good things for long term growth.