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Thread: Flat tax it

  1. #1
    Olympic Champ RYou's Avatar
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    Default Flat tax it

    ..or will just eliminate deductions as a means of increasing federal revenue ?

    Obama pledges to simplify the tax code
    President vows to make it reward work, help people pursue their dreams

    updated 22 minutes ago
    WASHINGTON - President Barack Obama said Wednesday that he aims to take the dread out of tax-filing day.

    Obama said at a White House event that he's working toward "a simpler tax code that rewards work and the pursuit of the American dream."

    "For too long, we've seen taxes used as a wedge to scare people into supporting policies that increased the burden on working people instead of helping them live their dreams," Obama said. "That has to change, and that's the work that we've begun."
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    Default Re: Flat tax it

    Hmm. I saw this story. Obama's statement is ringing my bs detector off the wall. Since when has the tax code been used to "reward work and the pursuit of the American dream"? How about those who dream of being able to go to the doctor for some medical need?

    Flat taxers never respond to my question about the use of the tax code as an instrument of public policy--as if it doesn't exist.

    The last time I looked at the tax code, it seemed like the bulk of it concerned business matters, but I could be mistaken. So what might a "simplier tax code" look like? Who knows? But it sounds good. Stay tuned.

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    Default Re: Flat tax it

    Some deductions are based on the cost of doing business and can't fairly be eliminated. If I gross $100,000, but have to pay out $60,000 in employee salaries, and you gross $100,000, but only have a payroll of $20,000 (everything else being equal), we shouldn't be taxed the same amount. It is the nature of some businesses to have a lower profit margin.

    Other deductions are based on public policy, like charitable contributions, mortgage interest, or energy conservation measures. Tax exemption for religious organizations is one of my pet peeves (surprise!). These can be adjusted depending on how the government wants you to spend your money, and won't affect the fairness of the tax system.

    "A simpler tax code that rewards work and the pursuit of the American dream" does indeed sound like bs. Does it reward a hard working little guy who finally earns enough to buy a home and a car and spend two weeks in Bermuda each year and still have enough for a secure retirement? Does it reward a sharp investor or entrepreneur who goes from a meager existence to becoming a billionaire? Who gets the tax breaks and who makes up the difference?
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    Olympic Champ RYou's Avatar
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    Default Re: Flat tax it

    You're the bulk of the federal tax code is focused on business, but he's talking about families. For individuals and families, it's rather simple - income = tax bracket = tax owed.

    When is the tax code complicated ? When you try to figure out what is and isn't deductible from your gross income. Simple logic tells you that to simplify taxes is to eliminate deductions. Eliminate deductions and your taxable income rises. Proportionately, the elimination of deductions will negatively impact you as income increases.

    Ergo, a tax increase for those that qualify for existing deductions. It's been proven mathmatically, that a flat tax that is equal for all will ultimately result in greater federal income, purley from elimination of the $0 tax for those that know how hide their income behind investment havens.

    You would be amazed at what those in the entertainment and sports fields get to deduct to reduce their taxable income. Everything from in home theaters, to the food they for slim and trim diets, tennis courts swimming pools to keep fit and maintaining image.

    For many things, all you need is a prescription from the doctor and it becomes a medical deduction. A little over weight, have the doc put in writing you need to exercize, then go out and buy your treadmill or bowflex and bingo, a medical deduction.
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    Ancient Arachnid Spider's Avatar
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    Default Re: Flat tax it

    Quote Originally Posted by RYou View Post
    You're the bulk of the federal tax code is focused on business, but he's talking about families.
    That's true. I tend to see things as all about me, and my business income is my family income.
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    World Champ ODH's Avatar
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    Default Re: Flat tax it

    If the tax code is simplified, it should be redesigned to increase revenue or at least be revenue neutral.

    We are spending way too much & not collecting enough taxes. To bring the national debt under control, both issues have to be addressed.

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    Default Re: Flat tax it

    [QUOTE=Spider;167267]Some deductions are based on the cost of doing business and can't fairly be eliminated. If I gross $100,000, but have to pay out $60,000 in employee salaries, and you gross $100,000, but only have a payroll of $20,000 (everything else being equal), we shouldn't be taxed the same amount. It is the nature of some businesses to have a lower profit margin.
    QUOTE]

    Yea, a flat business tax would be a doozy. Imagine the value an Exxon Mobil or a Microsoft would have to pay. We could do away with the personal income tax.

    I wouldn't presume that they would tax two businesses the revvenue equally knowing they having different operating expenses, but they could very tax the net profit equally on a % basis, or even on a graduated basis.
    Life's not the breaths you take, the breathing in and out that gets you through the day ain't what it's all about. It's the moments that take your breath away.

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    Default Re: Flat tax it

    I thought when Steve Jobs campaigned on the flat tax, the flat rate he was promoting was failry low (maybe 15%). A lot of that was from eliminating personal loopholes, but I also remember it was really funded by an increase in income taxes on businesses.

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    Default Re: Flat tax it

    Steve Forbes, son of Malcom Forbes of Forbes magazine fame.

    By memory, he ran for President not once, but twice, so his plan for a flat tax may have changed. I remember 17% as a figure.

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