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    Default Taxes - What's the best system?

    What's the most fair and/or the most optimized method of taxing? This is coming from thoughts about: You're probably a tax cheat! Even if online stores don't charge it, you're supposed to pay it and new law will try to force you | Mail Online but I'm thinking about taxes as a whole, rather than just internet sales tax, etc.
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    Default Re: Taxes - What's the best system?

    A percentage. If everyone paid the same percentage it probably would be less than what we pay now. Hell make it %8 for everyone regardless of what you make and for capital gains as well. And do away with claiming gambling losses, mortgage interest. The only people I know that can claim it can barely afford their house to begin with. In my mind only business should have write offs.

    But what do I know? I just know paying %20 to federal is bs IMO.

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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by chubb View Post
    A percentage. If everyone paid the same percentage it probably would be less than what we pay now. Hell make it %8 for everyone regardless of what you make and for capital gains as well. And do away with claiming gambling losses, mortgage interest. The only people I know that can claim it can barely afford their house to begin with. In my mind only business should have write offs.

    But what do I know? I just know paying %20 to federal is bs IMO.

    Sent from my Nexus 4 using Tapatalk 2
    Okay, so if you make $10,000,000,000 you pay $800,000,000 regardless of how it was earned and if you make $100,000 you pay $8,000, etc? That seems pretty fair, but, to play devil's advocate, also somewhat regressive in that, while both percents are equal, one could $8,000 means more to someone barely squeaking by at $100,000 than $800mm does to someone who still has $9.2 billion more to spend. The example is starker if you say the lower of the two makes $20,000. $1,600 is a big deal when you're living in poverty, even if it's about $130 a month, if every dollar counts, not having that extra $130 every month can really hurt. I believe that's the justification for the progressive tax... not sure I buy it entirely, but I can see how it seems, "unfair" to people getting hit on both sides of the spectrum. From the go-go-billionaire's perspective, "wtf, I just paid you $800 million and you want more?!" and for the poorest people, it's "wtf, I have to quit my job because I can't afford daycare (this type of paradoxical scenario)...
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    Default Re: Taxes - What's the best system?

    Also, I'd have to double check this, but I think that if 100% of citizens US citizens and people employed by US companies and people working in the US paid 8% of ALL INCOME, we'd have a ridiculous budget surplus. I mean, can you imagine if Facebook, Apple or Google paid 8% of their income? Then each of the top stock-holders paid 8% of their income, etc..... all the people who pay $0 or receive money back instead contributed... the gov't would be swimming in money like Scrooge McDuck.
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by NothingIsTrue View Post
    Okay, so if you make $10,000,000,000 you pay $800,000,000 regardless of how it was earned and if you make $100,000 you pay $8,000, etc? That seems pretty fair, but, to play devil's advocate, also somewhat regressive in that, while both percents are equal, one could $8,000 means more to someone barely squeaking by at $100,000 than $800mm does to someone who still has $9.2 billion more to spend. The example is starker if you say the lower of the two makes $20,000. $1,600 is a big deal when you're living in poverty, even if it's about $130 a month, if every dollar counts, not having that extra $130 every month can really hurt. I believe that's the justification for the progressive tax... not sure I buy it entirely, but I can see how it seems, "unfair" to people getting hit on both sides of the spectrum. From the go-go-billionaire's perspective, "wtf, I just paid you $800 million and you want more?!" and for the poorest people, it's "wtf, I have to quit my job because I can't afford daycare (this type of paradoxical scenario)...
    Well they could keep the right to work credit to help the lower income. And for the rich yes 8% is a lot for them but I did say make it 8% for capital gains witch is a heck of a lot cheaper ( I think its 20 or 25% now.). I just worked 140 hrs in two weeks(80 of reg. 21 of double time and 39 time and a half). Was $10 short of a double paycheck, but had a few bucks more than triple the taxes taken off. That sucks.

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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by chubb View Post
    Well they could keep the right to work credit to help the lower income. And for the rich yes 8% is a lot for them but I did say make it 8% for capital gains witch is a heck of a lot cheaper ( I think its 20 or 25% now.). I just worked 140 hrs in two weeks(80 of reg. 21 of double time and 39 time and a half). Was $10 short of a double paycheck, but had a few bucks more than triple the taxes taken off. That sucks.

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    I really don't think overtime and bonuses should be taxed any differently than regular salary/wages.
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by NothingIsTrue View Post
    I really don't think overtime and bonuses should be taxed any differently than regular salary/wages.
    Same here but since I had all that extra money I jumped a few tax brackets for that pay. Sucks when you don't make a ton of money like me, that money I paid in taxes would have helped a lot to pay off debt. Now I'll have to wait till next year and see what they give me back outta it if anything.

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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by chubb View Post
    Same here but since I had all that extra money I jumped a few tax brackets for that pay. Sucks when you don't make a ton of money like me, that money I paid in taxes would have helped a lot to pay off debt. Now I'll have to wait till next year and see what they give me back outta it if anything.

    Sent from my Nexus 4 using Tapatalk 2
    That actually brings up an interesting point... tax withholding. If taxes were not taken out of your check, you could invest it and earn dividends or interest OR you could lower debt, and thus reduce future expenses in interest, etc. Bottom line, in either scenario, the government holding on to your money is costing you money... to the tune of at least 2% to 20% in interest, and incalculable in terms of investment. Shouldn't they be paying us interest for holding on to the money, since it's more in our favor if we give them 0 throughout the year, then pay them in one lump sum one per year? Compounded interest over your life-time can create some pretty serious numbers. Next question, are they investing this money and earning interest? Or, more likely, are they just using it to float the interest on their own debt?
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by NothingIsTrue View Post
    That actually brings up an interesting point... tax withholding. If taxes were not taken out of your check, you could invest it and earn dividends or interest OR you could lower debt, and thus reduce future expenses in interest, etc. Bottom line, in either scenario, the government holding on to your money is costing you money... to the tune of at least 2% to 20% in interest, and incalculable in terms of investment. Shouldn't they be paying us interest for holding on to the money, since it's more in our favor if we give them 0 throughout the year, then pay them in one lump sum one per year? Compounded interest over your life-time can create some pretty serious numbers. Next question, are they investing this money and earning interest? Or, more likely, are they just using it to float the interest on their own debt?
    Exactly. That's why I try to pay just what I have to so that at the end of the year I do t owe. But I like having it taken before I have a chance to spend it. Because I know I do t have the financial discipline to save exactly what I would owe. I know a few people that claim 0 and invest money for the purpose of paying taxes next year just to earn the profits. I would say the option to have it taken automatically or not should be up to the individual. If your good with your money you could actually make a decent return on your tax money throughout the year.

    But try to get the government to operate without that money coming on throughout the year. That's the hard part. They need to run the co try like the do their house. Budget and only spend what you have.

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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by NothingIsTrue View Post
    Also, I'd have to double check this, but I think that if 100% of citizens US citizens and people employed by US companies and people working in the US paid 8% of ALL INCOME, we'd have a ridiculous budget surplus. I mean, can you imagine if Facebook, Apple or Google paid 8% of their income? Then each of the top stock-holders paid 8% of their income, etc..... all the people who pay $0 or receive money back instead contributed... the gov't would be swimming in money like Scrooge McDuck.
    On the business side I think the should be able to write some stuff off. But another example is someone that has a home office. They can write off part of the mortgage, electric, internet, water, and phone bills. Just for having an "office" that may never really be used anymore that non business owners do to pay bills and such. Not that I say its wrong but something's should be modified. You should have to actually use that office, in your house, for your business if you have an actual office elsewhere. I don't know how you would prove it though.

    But back to the googles and facebooks of the world. If you claim $1 billion in profit you should have to pay tax on most of that, say something like half of the profit. Claiming losses and such to pay say $15 million on a billion profit is bs if you ask me. But then again, the IRS hasn't asked me either.

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    Default Re: Taxes - What's the best system?

    Tax brackets, e.g 1st 20,000 is untaxed, next 30,000 lets say at 5% then the next $30,000 10% etc. Not a flat rate across the whole thing but parts of it untaxed while other parts taxed.
    E.g If I earned 100K, the first 20k will be untaxed, the next 30k will be taxed 5% and then next 30K at 10% then so on. However, the % would be a big larger since the starting base figures aren't taxed.

    In my view the rich should get taxed more. Simple as that.
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by Fairclough View Post
    Tax brackets, e.g 1st 20,000 is untaxed, next 30,000 lets say at 5% then the next $30,000 10% etc. Not a flat rate across the whole thing but parts of it untaxed while other parts taxed.
    E.g If I earned 100K, the first 20k will be untaxed, the next 30k will be taxed 5% and then next 30K at 10% then so on. However, the % would be a big larger since the starting base figures aren't taxed.

    In my view the rich should get taxed more. Simple as that.
    That's fairly similar to what we're supposed to have right now, however because of some major loopholes, it actually functions upside down. The highest incomes still pay by far the most money into the system, but they pay far less than the lowest group of people who actually pay income taxes. From the perspectives of everyone actually paying it seems completely unfair.
  13. #13  

    Default Re: Taxes - What's the best system?

    I'm a big Fair Tax supporter (the actual named plan, not simply for a fairer plan). To type everything in my head out about it on my phone would be a pain, but I'll try to at least cover a list of the important points. I know I won't cover them all, but I think this is the best but underreported tax plan around.

    Millions of PRIVATE funds used to develop and research the plan with the sole goal of being the fairest plan for everyone. This isn't some government proposed idea laced with loopholes.

    Virtually does away with the IRS, the tax code is only about 100 pages (don't remember the exact number, but tiny compared to the current code none the less), and April 15th becomes just another day.

    Income tax eliminated and REPLACED with a single sales tax included within the shelf price of all new (so second hand/used items exempt) items at the retail level (many opponents try to say the sales tax is in addition to an income tax, or something like a value added tax, both of which is untrue)

    Billions saved on people and businesses not having to do tax preparation and able to make better decisions without worrying about tax implications.

    You keep 100% of your paycheck.

    The planned national sales tax rate of about 22-23% will keep shelf prices about the same as they are now since the current embedded taxes are now removed. Even if they are a little more, it is still more than offset by the extra you have from zero federal withholding (and expected state as they tend to follow the government lead).

    Everyone, from the minimum wage earner to billionaires get a prebate check equal to the tax they would pay for their family situation if living at the poverty level so NO ONE has to pay tax on the basic necessities (remember, this plan treats everyone the same, no favorites are played). So people living at poverty actually pay no tax to simply live, those living below poverty get extra money back. Those above pay a greater percentage of their spending to tax.

    You get control over how much tax you pay because buying used items and investing instead of spending doesn't get taxed.

    Since this is tax paid at the register, EVERYONE will now pay in, including tourists and people in underground/under the table/illegal jobs that now don't report income for taxation

    The tax plan is meant to be revenue neutral. It's designed to be a more efficient way of collecting taxes, and the debate over revenues and government spending is for another day.

    Investments would be able to skyrocket as capital gains and other similar taxes are eliminated, which also means we become the most tax friendly country in the world and would have businesses flocking back onto our shores.

    Corporate lobbying would be virtually eliminated because lobbyist will no longer be able to use the tax code to manipulate business.

    Can't think of the other points off the top of my head , but maybe this will be enough to chew on for now. I enjoy discussing this plan, so open to any questions. More info at www.fairtax.org
  14. #14  

    Default Re: Taxes - What's the best system?

    There is a few little loop holes in ours but not major only tax deductibles like work expenses, our mega rich are hating our new tax's e.g on mining but that was a flop as it failed to generate much revenue as our mining industry slowed down. I think most countries should have a complete overhaul to get rid of loop holes. In the end it should be a percent of your income and more % for the wealthier. Here is the exact figures of ours (source: Individual income tax rates - Aus Tax Office).


    The following rates for 2012-13 apply from 1 July 2012.
    Taxable income
    Tax on this income
    0 - $18,200
    Nil
    $18,201 - $37,000
    19c for each $1 over $18,200
    $37,001 - $80,000
    $3,572 plus 32.5c for each $1 over $37,000
    $80,001 - $180,000
    $17,547 plus 37c for each $1 over $80,000
    $180,001 and over
    $54,547 plus 45c for each $1 over $180,000
    The above rates do not include the Medicare levy of 1.5% (see Guide to Medicare levy for more information).
    » Tom Fairclough «
    » Credo faber est quisque fortunae suae «
    » I believe every man is the artisan of his own fortune «
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    Default Re: Taxes - What's the best system?

    The note on the national debt is greater than 100% of all personal income. Therefore, this conversation is moot.
  16. #16  

    Default Re: Taxes - What's the best system?

    Quote Originally Posted by Fairclough View Post
    In my view the rich should get taxed more. Simple as that.
    I'm curious why you have this view. A graduated system like this and what we have now is like a punishment for success. And if you're going to go with they "have to pay their fair share" argument, who decides what's a fair share? I'm sure the people making less than you would think you should pay more as part of your fair share.
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by Tall Mike 2145 View Post
    The note on the national debt is greater than 100% of all personal income. Therefore, this conversation is moot.
    Do you mean the interest or the entire bill or both? The way I've heard it described, if the our largest corporations that either pay 0% or get rebates and then pay 0% would pay their actual stated tax rate, we'd have a surplus without any private citizens having to pay a cent more. Yes, I know some corporations have single owners and/or shareholders that pay taxes as well, but we have a 35% "tax rate" for corporations, yet the largest pay < $0.01... so something is off there. I think 35% is too high, but 0% is too low.

    No matter how we think about taxes, and who should pay how much, at the end of the day the revenue needs to equal all of our expenses + all interest due + $0.01.
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by Mooncatt View Post
    Everyone, from the minimum wage earner to billionaires get a prebate check equal to the tax they would pay for their family situation if living at the poverty level so NO ONE has to pay tax on the basic necessities (remember, this plan treats everyone the same, no favorites are played). So people living at poverty actually pay no tax to simply live, those living below poverty get extra money back. Those above pay a greater percentage of their spending to tax.
    I've always been a supporter of a flat tax since the days Steve Forbes but always had a hard time with the fairness to poor people. This the the first that I've ever heard of the idea of a "prebate" check and when I first read your post that even billionaires should get it I kind of scoffed, but I thought it and I get your point about fairness and treating everybody the same because once you start making loopholes and exemptions you basically have let the genie out of the bottle. Furthermore, it seems to me that most of the extreme rich would donate their prebate checks, or at least part of it, to charities. There is still the problem of whether or not the poor could even afford to pay the tax upfront. They might simply not have the money to pay the extra expense that will be tacked on to the cost of things for basic living. The safety net for the poor would have to be strengthened for the poor and then I could see something like this working. Also, I get your point about why you don't feel like the rich should pay more in taxes because it is a form of punishment for success, but even a system like yours favors the rich since they pay a fraction of their income and wealth on goods. Then again, if you had more services for the poor I could see it as fair.
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    Quote Originally Posted by NothingIsTrue View Post
    Do you mean the interest or the entire bill or both? The way I've heard it described, if the our largest corporations that either pay 0% or get rebates and then pay 0% would pay their actual stated tax rate, we'd have a surplus without any private citizens having to pay a cent more. Yes, I know some corporations have single owners and/or shareholders that pay taxes as well, but we have a 35% "tax rate" for corporations, yet the largest pay < $0.01... so something is off there. I think 35% is too high, but 0% is too low.

    No matter how we think about taxes, and who should pay how much, at the end of the day the revenue needs to equal all of our expenses + all interest due + $0.01.
    If interest then depressing -- almost beyond hope depressing. If this site is correct then each US Citizen would have to pay $53,000 to pay off the bill. U.S. National Debt Clock
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by jdbii View Post
    I've always been a supporter of a flat tax since the days Steve Forbes but always had a hard time with the fairness to poor people. This the the first that I've ever heard of the idea of a "prebate" check and when I first read your post that even billionaires should get it I kind of scoffed, but I thought it and I get your point about fairness and treating everybody the same because once you start making loopholes and exemptions you basically have let the genie out of the bottle. Furthermore, it seems to me that most of the extreme rich would donate their prebate checks, or at least part of it, to charities. There is still the problem of whether or not the poor could even afford to pay the tax upfront. They might simply not have the money to pay the extra expense that will be tacked on to the cost of things for basic living. The safety net for the poor would have to be strengthened for the poor and then I could see something like this working. Also, I get your point about why you don't feel like the rich should pay more in taxes because it is a form of punishment for success, but even a system like yours favors the rich since they pay a fraction of their income and wealth on goods. Then again, if you had more services for the poor I could see it as fair.
    It does seem a little backwards compared to what we do now, in that the poorest people in the step above "profiting" from the rebate would pay high taxes on 100% of their income, while the richest people might only pay high taxes on 1-10% of their income. Effective tax rate on someone just above 200% of the poverty level (still dirt poor, but has a job) is 100%, effective tax rate on Mark Zuckerberg is .2%.

    The idea of doing it 100% as a sales tax is interesting, but without seeing the data on this, I don't understand how it can be revenue neutral... seems like it'd come up with 30% or so of our current taxes and be extremely regressive about who is paying what share in. The incentive is 100% on savings, not consuming and thus seems dangerous to economic growth except for in the financial services sector, which would have all money funneled to it by default; this is accelerating the "rich get richer, poor get poorer, middle class dies" model that we've been trying to execute on for the past 30 years.

    There could easily be something I'm missing that makes this stuff not happen.
  21. #21  

    Default Re: Taxes - What's the best system?

    Quote Originally Posted by NothingIsTrue View Post
    It does seem a little backwards compared to what we do now, in that the poorest people in the step above "profiting" from the rebate would pay high taxes on 100% of their income, while the richest people might only pay high taxes on 1-10% of their income. Effective tax rate on someone just above 200% of the poverty level (still dirt poor, but has a job) is 100%, effective tax rate on Mark Zuckerberg is .2%.
    The prebate check does admittedly take some thought. You have it backwards though. Look back at what I said, and also your statement of paying taxes on 100%of income. As already stated, this is not an income tax, but a sales tax on new items and services. People living at the poverty level pay no tax if they only buy necessities as the check pays them ahead of time monthly for the expected taxes on those goods. Hence the name PREbate instead of REbate (my bad for not making that clear earlier). Plus lower income people tend to buy more second hand goods (i.e. at Good Will and the like), so they don't pay taxes on as much of their items. Higher income people tend to buy mostly new, opt for higher end products, etc, so they pay more taxes for those goods. Not to mention their extra toys like boats, pools, and extras like landscaping services that poor people don't have. All of that is taxed, but isn't considered a necessity, and thus not included in the prebate.

    The idea of doing it 100% as a sales tax is interesting, but without seeing the data on this, I don't understand how it can be revenue neutral... seems like it'd come up with 30% or so of our current taxes and be extremely regressive about who is paying what share in. The incentive is 100% on savings, not consuming and thus seems dangerous to economic growth except for in the financial services sector, which would have all money funneled to it by default; this is accelerating the "rich get richer, poor get poorer, middle class dies" model that we've been trying to execute on for the past 30 years.

    There could easily be something I'm missing that makes this stuff not happen.
    This is a little more complex issue you bring up, but still works out as I understand it. The roughly 22% tax was determined in part due to additional people paying into the system. I don't have the data at hand on how they came up with the number, but i do know is over ten years in the making and that data should be available through the site I linked or in the Fair Tax Book. So we're talking millions of dollars paid in from sources that are currently not taxed for one reason or another. The people that developed the Fair Tax do acknowledge a spike in savings and investing, but is that a bad thing? No, as a nation we need to stop using so much credit, build nest eggs, and save for the future. The sad part is that most people in the county don't educate themselves enough financially to know to save more. They just see more money in their pockets and spend it. That's the same thing as if they got a raise at work under our current system and not a fault or problem with the Fair Tax.

    Hate to say it, but when people put their mind to something, they succeed. Those that don't, stay where they are or make bad choices that make them loose out. In my opinion, not that of the Fair Tax researchers, is that the rich will always get richer, and the poor will always get poorer. Those that are wise enough to at least start investing will probably kick start their accounts with extra money to catch up with, then plateau as they get caught up and relax their spending budgets. Those already investing are likely to see a spike in growth from businesses able to make better decisions for their company and not so much on tax implications. Now add to that the extra jobs expected to move back to the country, which both lowers unemployment and demand on social services, and adds more to the revenue base through increased spending of those people with new and better jobs. It's very possible that the tax rate could go down over time as things level out and jobs, revenues, and deficit reductions are realized.

    As a side note, even though the plan is meant to be revenue neutral, many supporters do expect that it will result in some budget surpluses if other spending is kept the same simply because there is less spending due to the elimination of the IRS, it's a simple way to collect taxes, and the expected boom in job creation.
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by NothingIsTrue View Post
    Do you mean the interest or the entire bill or both?
    Both, if I understand correctly. There's no way to pay it off, period. Then, on the other side of things, there's the fact that our currency is valueless and unconstitutional. Of course, everyone is just overly-eager to completely ignore those two little details. I've never known another country that can pretend its way out of financial collapse. Maybe we really are the United States of Awesome.
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  23. #23  

    Default Re: Taxes - What's the best system?

    Been thinking more about a better way to explain the prebate and how it helps low income earners and how high income earners pay a higher percentage of their spending to tax, and this example may help clear any remaining confusion:

    Take two workers who's life and family situation put their poverty level at the same amount. Just to use easy numbers, let's say that level qualifies them both for a $200/mo prebate check. Worker A, let's call him Andy, earns $2,000/mo,and worker B, Bob, earns $20,000/mo. That makes the prebate worth 10% of Andy's income, but only 1% of Bob's. Andy buys only what he needs just to get by, but everything is new and pays exactly the same amount in tax as his prebate was. His tax basis is effectively zero. Bob, having a lot more to spend but the same prebate amount could blow the entire prebate on a $910 TV (that's the shelf price with the inclusive 22% tax, so 22% of $910 is about $200). Plus all his new dress clothing for his obviously high level career, new cars every so often, probably a second house built at the lake with a boat, furnishings, pier, truck to pull that boat, on and on and on all new. That's a lot of tax he's paying.

    Now let's throw in worker (C)harlie, who also qualifies for the same $200 prebate, but makes even less than Andy. It's all he can do to make ends meet and has to buy most everything second hand that he can because he simply can't afford many new items. This could mean he only spent $100 in tax and still had the additional $100 leftover. When you're running a super strict budget, an extra $50-100 a month goes a long way.
    Darth Spock and jdbii like this.
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    Default Re: Taxes - What's the best system?

    Quote Originally Posted by Mooncatt View Post
    Been thinking more about a better way to explain the prebate and how it helps low income earners and how high income earners pay a higher percentage of their spending to tax, and this example may help clear any remaining confusion:

    Take two workers who's life and family situation put their poverty level at the same amount. Just to use easy numbers, let's say that level qualifies them both for a $200/mo prebate check. Worker A, let's call him Andy, earns $2,000/mo,and worker B, Bob, earns $20,000/mo. That makes the prebate worth 10% of Andy's income, but only 1% of Bob's. Andy buys only what he needs just to get by, but everything is new and pays exactly the same amount in tax as his prebate was. His tax basis is effectively zero. Bob, having a lot more to spend but the same prebate amount could blow the entire prebate on a $910 TV (that's the shelf price with the inclusive 22% tax, so 22% of $910 is about $200). Plus all his new dress clothing for his obviously high level career, new cars every so often, probably a second house built at the lake with a boat, furnishings, pier, truck to pull that boat, on and on and on all new. That's a lot of tax he's paying.

    Now let's throw in worker (C)harlie, who also qualifies for the same $200 prebate, but makes even less than Andy. It's all he can do to make ends meet and has to buy most everything second hand that he can because he simply can't afford many new items. This could mean he only spent $100 in tax and still had the additional $100 leftover. When you're running a super strict budget, an extra $50-100 a month goes a long way.
    Okay I get the prebate part of it and it helps justify the plan. The personal responsibility part of buying 2nd hand stuff to avoid taxes and thus save more money is key there... I'm still struggling with the difference between the billionaire and the person only making $100,000... because the former will spend a tiny portion of their income relative to the latter who will spend almost their entire income. Yes, they could buy 2nd hand things to mitigate that disproportion, but there is a certain level, just like in today's system, where once you're past a certain income/spending threshold, the tax becomes completely regressive. Assuming that, similar to today and this plan, there is a level of income, below which we would not expect any contribution, then the advantage here seems to be that it taxes everyone, not just those who are lawfully employed. But it seems to fail in a few other areas... business taxes, taxes we currently collect from citizens abroad and it creates heavy incentive for one to purchase new high end goods directly from out-of-country sources, where shipping may be less than the amount of taxes they would pay. The FAQ says it's price neutral because it's revenue neutral, but that seems like nonsense. In what world do business not protect margins by passing additional costs on to the consumer, even if there are windfall savings to be had later on? Under this plan, what would Facebook as a company owe to the government in Taxes? Are they paying taxes on supplies for their company or is it just consumer goods? The FAQ seems to indicate they'd pay 0. How about states where sales tax is currently illegal. I'm assuming this would override their law?

    Sorry if this seems like I'm attacking the plan or you, I'm really not. I am trying to grasp how it works in it's entirety and you seem to understand it with more context than the website you linked does (which is odd). There are some very strange implications of this plan, most of which are positive, but it also has what feel like dangerous assumptions in it. I'm absolutely sure someone has thought through it all, so I'm checking online for answers to these questions too.

    Edit: Other question which this system doesn't address... our current revenue is not enough. 23% of spending isn't enough and realistically, 46% might not be.
  25. Thread Author  Thread Author    #25  
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    Default Re: Taxes - What's the best system?

    I'm still watching the videos on the Fair Tax, but the guy presenting them is coming off as incredibly naive... Within 20 seconds he said companies would lower prices if their expenses were reduced... the only thing that lowers price is competition... otherwise, you're only increasing profits.. and he said that if we don't tax our exports it'll be great for overseas trade... which is true, definitely! ... but it also means that our government has incentive to increase imports because we tax those, as opposed to increasing our exports. There can be many good reasons for making this the case, but it's also really dangerous to remove our interdependence and replace it with dependence on foreign markets.

    I have the new tax plan and it will work and is fair:

    1. It's clear that corporations have merged with the government, taking the People out of the equation entirely other than our temporary handling of the fuel, dollars.
    2. Because of 1, the People being no longer represented and the corporations being fully represented, no people shall ever be required to pay any tax.
    3. Corporations will shoulder 100% of the tax burden. The bill will be equal to the total expenses of the government, divided in perfect ratio to the gross income of each company divided by the gross income of all companies.
    4. There are no loopholes, exceptions, rebates, stimulus packages, etc.
    5. If 1 through 4 do not work, take control of the government away from corporations and return it to the People.
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