Things That Taxes Should Not Do

Discussion in 'Politics' started by Madeline, May 28, 2010.

  1. Madeline
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    Madeline BANNED

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    In the United States, the most significant income stream for the federal government is the income tax, for the states it is the sales tax and for local governments it is the property tax. However, feel free to discuss any tax, fee, duty, or other charge imposed by government as you see fit.

    IMO, a system of tax or taxes works best when it remains entirely true to its original purpose: developing revenues for government operations. The further afield it wanders from that purpose, the less effective it becomes. As a mechanism for forcing social change, the tax system is the very least efficient tool in the government toolbox.

    So here are some stupid tax provisions I would repeal:

    1) The marriage discount. If I and my single neighbor each make $50,000 and we pay tax at a 10% rate (this is all hypothetical), we will pay $5,000 apiece for a total of $10,000. If we marry and file jointly, we'll receive a marriage discount and the first $25,000 of one of our incomes will be sheltered, so our total tax burden is reduced to $7,500.

    But we are no cheaper to defend, we produce no less garbage that needs collecting, and we need no fewer other government services. The marriage discount exists in our tax law only because of changing social mores in the US concerning married women working outside the home and it has always been irrational as a matter of tax policy. If the government needs only $17,500 to operate, then all adults should be given a share of the tax break; single people should not be underwriting some government costs for married people.

    2) Encouraging home ownership. Not merely content to offer a tax discount on the interest paid on both a first and second mortgage on BOTH a first and second home, or a maximum of FOUR mortgages, the US now also awards enormous tax credits to purchasers of residential real property. Home ownership may or may not help stabilize a community but it does not need government intervention to achieve that result -- most folks desire a home of their own without having to be bribed into buying one. Those that are bribed into it may actually be detracting from the stabilization of their communities and in any event, renters should not have to underwrite the cost of home ownership for their neighbors.

    3) Encouraging charity. The tax discounts available for gifts to all sorts of charities are so deep, most for-profit corporations have gifting programs. Since corporations are not human, they cannot have "generosity", so this is all done in response to tax discounts. But if the gifting is valuable because of the needs met by charity, then either the gifts should be made without any need for a tax discount or the needs should be elevated to ones met by government. In this vein, tax immunity for charities also seems irrational to me. Why should my Jewish neighbors help underwrite the costs of the local Catholic parochial school? Why should anyone's tax bill go up so as to allow some other private person to "give more"?

    4) Discouraging bad habits. When the main purpose of a sin tax is to punish smoking, etc. it is demonstrably ineffective. Because these taxes are not tied to income, they fall much more heavily on the poor than anyone else. I fail to see why my poorest neighbors must suffer disproportionately because I want everyone to stop smoking. Why not merely criminalize smoking?

    5) Encouraging certain investments, stimulating the economy, etc. There is a limited value to tinkering with a nation's economy by altering its tax code -- but this will never begin to compete with the effect that can be had by tinkering with its banking system. When we elevate certain investments, e.g., tax rebates for buying energy star appliances or accelerated depreciation for certain asset purchases, what we are trying to do is alter the buying habits of consumers and businesses. Those who do not buy underwrite these acquisition costs for those who do, and the motive -- tax savings -- is not grounded in economic reality. Better to force feed lower interest rates, etc. so that people and businesses buy what they really want and need.

    Okay, that's a few examples. The bottom line for me is that taxes should be imposed as fairly and simply as possible and ONLY to develop funds to operate government -- not to advance social policies, etc. To do so is inefficient, wasteful and unfair.


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    Last edited: May 28, 2010
  2. froggy
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    froggy Gold Member

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    It should not keep up illegals.
     
  3. Madeline
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    Madeline BANNED

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    froggy, illegal aliens do not pay income taxes. I'm not sure I got your point.
     
  4. kwc57
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    kwc57 BOHICA Obama

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    True, they don't........but they use up a lot of tax dollars that should be spent on citizens.
     
  5. froggy
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    froggy Gold Member

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    How many illegals get free medical, and all other free programs that tax dollars support.
     
  6. froggy
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    froggy Gold Member

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    Oh, by the way, why don't you ditch the blue and use dark green. just a thought.
     
  7. Madeline
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    Madeline BANNED

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    froggy, the expenses of government are NOT determined by the tax code. That's the budget, and while I might agree with you, it is not exactly on-point.

    Oh, and just this once because you asked so nicely:


    A dark green font color!

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  8. JW Frogen
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    JW Frogen Gold Member

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    In my opinion sin taxes are the most egregious failure of all tax as social engineering tools.

    Most governments know this but prefer to label a pick pocket operation as a moral imperative.

    Those who wish to sin will do so and simply pay the price, it has been ever thus since Lucifer told God to get off his back, passed good and retired to a warmer climate.
     
    Last edited: May 28, 2010
  9. froggy
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    froggy Gold Member

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    What are you saying, you posted "Things That Taxes Should Not Do" and i said our taxes shouldn't be used to keep up illegals. A little darker green, please. and replace the blue with green.
     
    Last edited: May 28, 2010
  10. kwc57
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    kwc57 BOHICA Obama

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    Americans For Fair Taxation:

    What is the FairTax plan?
    The FairTax plan is a comprehensive proposal that replaces all federal income and payroll based taxes with an integrated approach including a progressive national retail sales tax, a prebate to ensure no American pays federal taxes on spending up to the poverty level, dollar-for-dollar federal revenue neutrality, and, through companion legislation, the repeal of the 16th Amendment.

    The FairTax Act (HR 25, S 296) is nonpartisan legislation. It abolishes all federal personal and corporate income taxes, gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes and replaces them with one simple, visible, federal retail sales tax administered primarily by existing state sales tax authorities.

    The FairTax taxes us only on what we choose to spend on new goods or services, not on what we earn. The FairTax is a fair, efficient, transparent, and intelligent solution to the frustration and inequity of our current tax system.

    The FairTax:

    • Enables workers to keep their entire paychecks
    • Enables retirees to keep their entire pensions
    • Refunds in advance the tax on purchases of basic necessities
    • Allows American products to compete fairly
    • Brings transparency and accountability to tax policy
    • Ensures Social Security and Medicare funding
    • Closes all loopholes and brings fairness to taxation
    • Abolishes the IRS
     

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