I am brand new to the board and have enjoyed what I have read so far. I thought I would use my first post to open a discussion on a subject I am passionate about. With the Bush tax cuts expiring soon and the administrations interest in preserving some for lower income taxpayers, congress will almost certainly be addressing taxes in the near future. I am interested in opening a discussion which could lead to a proposal to individual members of congress to replace the current capital gains tax with a more efficient and perhaps better way to tax investments. The current capital gains tax has many negative factors for both the government and the investor. In the case of the government, payment of taxes on investment profits can be delayed for years or even decades, while investment losses can be deducted from investment profits that are claimed. In addition, non resident aliens investing in US markets are generally not subject to US capital gains tax at all. For investors, tax rates are subject to the political climate, causing investors to be uncertain where they stand with their investments. I am proposing that congress repeals the capital gains tax and replaces it with a smaller flat tax at the time the investment is initiated. All investments would be taxed, profits would not be taxed. Investments made prior to enacting this law would still be subject to capital gains. Only new investment made after passage would be subject to the new tax. A small tax of 3-5% would yield an increase to the treasury as taxes could no longer be deferred and non resident aliens would have to pay their share for the privilege of investing in US markets. Some unhealthy practices would disappear, such as computer trading stocks for fluctuations of pennies. Concerning investments such as real estate or stocks purchased with margin, borrowed money (i.e. mortgages or margin) would be taxes within the payment schedule. For example, a home buyer would pay the tax on the down payment and be taxed on the principal portion of all succeeding payments. Right now, the political environment is positive for grass roots initiatives. Please share your opinions and ideas. Perhaps an improved version of this proposal may make it into the main stream.