A Flat Tax: Please help me understand how it is unfair to have a flat tax!

[DiamondDave]

I would exempt the first $30, 000.00 and have from there upward be taxed at a flat rate, including capital gains.

The $30, 000.00 exemption would, though, include a Millionnaire's first $30k as well.

And as you might be able to see... I have broken it down to show the inequity in that scenario as well... it is just another name for the same progressive bullshit

I don't care if it's not fitting to your personal worldview, I find it more humane - and it has the added bonus of not taxing ANYone on their first $30k.

So... you would not refrain from claiming other things as unequal treatment when they go against your personal situation, I would tend to guess.... like so many others..

It is about what our government is supposed to be about... the protection of freedoms and the equal treatment by government under law

 

[DiamondDave]

The rich take the flat tax, don't even need an accountant. The poor/middle opt for the old method AND have to pay an accountant. Brilliant- for the rich. This is just more Pub pie inthe sky anyway- to make the dupes forget they get screwed by the Pubs EVERY TIME. Pffffft!!

Wrong thread.. moron troll

 

[G.T.]

And as you might be able to see... I have broken it down to show the inequity in that scenario as well... it is just another name for the same progressive bullshit

I don't care if it's not fitting to your personal worldview, I find it more humane - and it has the added bonus of not taxing ANYone on their first $30k.

So... you would not refrain from claiming other things as unequal treatment when they go against your personal situation, I would tend to guess.... like so many others..

It is about what our government is supposed to be about... the protection of freedoms and the equal treatment by government under law

My personal situation is fine. Leave that at that.

What I'm not for, is giving the least fortunate in this Country an unequal burden.

Let's simplify:

If food and necessities all Cost $1.

I earn $100/year.
You earn $1/year.

A 10% tax makes you unable to eat - that's your burden.........; whereas, a 10% tax wouldn't take away from any of my Ability to get any of my necessities. Here you go, glad to help.

 

[NYcarbineer]

I would exempt the first $30, 000.00 and have from there upward be taxed at a flat rate, including capital gains.
The $30, 000.00 exemption would, though, include a Millionnaire's first $30k as well.

And as you might be able to see... I have broken it down to show the inequity in that scenario as well... it is just another name for the same progressive bullshit

How do you propose to get people with no money to pay their equal share of the federal tax bill.

Let's say the budget is 2 trillion. Let's say we have 200 million people that have to pay that.

That comes to 10,000 per person. EQUAL TREATMENT. How are you going to make the 10,000 a year guy pay his EQUAL SHARE? Take ALL his money?

 

[PLYMCO_PILGRIM]

A flat tax is only fair if you eliminate deductions. And even then, it's only fair in one sense of the word.

I agree on ZERO EXEMPTIONS FOR ANYTHING.

How about if I used the word equitable instead of fair?

 

[PLYMCO_PILGRIM]

See as soon as you have two tiers, people like DiamondDave says no good, you now have a progressive system. He's right, that is a progressive system, but that doesn't mean what he wants is a better option. Basically, his system would completely shit on the poorest among us in the name of "fairness".

To be fair to dave, I agree with him as I stated in the last paragraph.

However, I'm just trying to discuss it so being open to the idea helps the discussion continue

What he don't understand is equality does not inherently mean end income "better situations" for all... but I will take equality in treatment that more resembles the sales tax system than I will a system where personal perceptions create a shifting playing field

I probably should have been more clear (as you suggested to me before) in how I worded the first post.

By fair I did mean equitable treatment under the law but I do understand how saying fair instead of being specific leads to all the other comments. I am ok with that though as I want to see what people's ranges of opinions are so I can challenge them and have them challenge me.

 

[PLYMCO_PILGRIM]

Flat tax is just code for lowering taxes for the wealthy but not for most Americans, as most flat tax rate proposals have the majority of Americans paying the same exact rate or higher than what they currently pay, while considerably lowering the tax rate of the wealthiest Americans. No one with a straight face can claim that is fair.

I find it hard to claim that making one person pay 50% of their income in taxes while allowing someone else to only pay 5% is equitable treatement, regardless of income levels.

 

[PLYMCO_PILGRIM]

So both of you are basically saying that at lower income levels the taxes are actually going to take away from money for basic needs while at higher income levels the taxes would not take from money the people need to survive, making a flat tax unfair. Correct?

Would either of you be able to support a flat tax that say taxed all income over $20,000 at XX percent and all income under $20,000 at zero percent. Basically a flat tax that doesn't start taxing income until some basic level of income is reached.

While that would obviously be better than a flat tax with no exemptions, the answer is no. That a tax on the very poor is taking survival money is only part of the picture. Remember, I listed four ascending uses of money: survival, luxury, savings/investment, and gambling. While we obviously don't want to tax away survival money, luxury and savings/investment also serve useful purposes in the economy and taxing those is not as acceptable as taxing gambling money (but acceptable if gambling money won't yield enough revenue by itself, which is the case).

I would have:

The first $20k of income be untaxed, as you said.
A confiscatory tax on income above $1 million, on the order of at least 50% and probably more like 70+. This would discourage accumulation of vast fortunes and serve to drive more investment into the real economy instead of into gambling, particularly if all such investment was fully tax-deductible (as it should be).
Taxes set on all income in between the two at whatever rate is necessary to meet government expenses.

The middle bracket could probably be a single rate without any problem.

Yeah we wont agree on that one as that is basically our current system .

 

[Care4all]

Flat tax is just code for lowering taxes for the wealthy but not for most Americans, as most flat tax rate proposals have the majority of Americans paying the same exact rate or higher than what they currently pay, while considerably lowering the tax rate of the wealthiest Americans. No one with a straight face can claim that is fair.

I find it hard to claim that making one person pay 50% of their income in taxes while allowing someone else to only pay 5% is equitable treatement, regardless of income levels.

they pay the same marginal rate for their dollars earned as anyone else. if the poor person someday climbs the ladder and makes the same income dollars as the millionaire, they too would be taxed at the same rate for each marginal tax rate bracket for each dollar they earn.

progressive rates are equitable and or fair.....the irs 10ft high on paper tax deductions, exemptions, credits, etc, is what makes it 'unfair' so to say....a flat progressive tax, with no deductions other than the standard deduction could be fair as well, as long as all dollars earned, are taxed at the same flat rate in the marginal tax brackets. No one making 250k a year is paying any taxes on their first 10k, no one making a million is paying taxes on their first 10k and no one making 10k is taxed on their first 10k....

seems 'fair' to me....and no one would be paying a dime more than anyone else for every dollar earned....

 

[PLYMCO_PILGRIM]

The title says it all.

I think a flat tax on all americans is the only truly fair tax structure.

For all examples please use a 10% tax rate, I know its not realistic and would have to be higher but just for math purposes in any pro/anti flat tax examples lets use the easy number.


To me a person making $10,000/year paying $1,000 in taxes while a guy making $10,000,000/year paying $1,000,000 in taxes is fair.

I'm not sure how, under our current system at the end of the year, someone making $50,000/year being responsible for ~$12,500 in federal income tax while someone making $25,000/year is responsible to pay ~$3750 in federal income tax. After deductions its more like $8,000 and $0.00 which still doesn't sound fair to me.


So....now that my opinion is here please try to explain to me or convince me how a flat tax is less fair overall than our current tax system.

While a flat tax may sound fair and equitable, it is not. It also doesn't make sense if it were made to actually be fair and equitable. Those of you on the right get so hung up with those who pay no federal income taxes that you simply choose to ignore all the other taxes that are paid by those same people.

Anyway, here is the deal on a flat tax with no deductions for anyone. First of all, to be fair, all other taxes must be rescinded. That means no more excise taxes, no more state sales taxes, no more sin taxes, no more payroll taxes, no more property taxes, no taxes on anything, just a flat income tax for everyone. Let's first start with the necessary rate which would need to be between 30% and 35% based on current spending. That is just for the federal government. On the flipside, the state flat tax would need to be approximately 7% to 10%. Now remember, nobody gets any tax breaks and all income is taxed, capital gains, corporate profits, everything. Are you still liking this flat tax idea now? The rates may seem a bit high, but you must remember that all other taxes must be removed to be fair, and then we would need to account for some income slipping between the cracks and being unreported.

By making everything fair under such a flat tax, people who visit the US will no longer pay any taxes, illegals who work under the table will no longer pay any taxes either. At least now they pay some taxes through sales, sin, and excise taxes. The first thing I can think of is that it would also give great reason for many people to find ways to hide income. The truth is, such a system doesn't even begin to make any sense, and it would be terrible for everyone involved.

Now, you are probably going to tell me that you just meant making a flat tax for federal income taxes and leaving everything else alone. But since the lowest income earners pay the biggest percentage of their income in all those other taxes that the wealthy do not, all of a sudden, we would have the poorest Americans paying the highest percentage of taxes, and the wealthiest Americans paying the least. If this is your true agenda, then just say so. If you really think a flat tax on just federal income taxes is fair, then you haven't done the research or you've just been listening to those right wing nutjobs on the radio too much.

No I still disagree and I don't listen to rightwing nutjobs on the radio...Jim browdy and Margerie Eagan are not right wing nutjobs, look them up.

I did intend to replace ALL FEDERAL taxes with a flat tax rate that is the same for everyone.

Your point that the poorer would pay a higher percentage in income under a flat tax is just wrong. I understand why you tried to make that connection but if you actually put it onto paper, in numbers, you find that everyone is paying the same percentages still. The sales tax will still be 5% for the guy making 5 figures and the guy making 8 figures, the excise taxes on things will still be the same percentage of their values, the sin taxes will still be $xx.x/bottle for things like booze for everyone.

I get it...say someone makes 10,000 and someone makes 100,000 and both pay 10% income tax so thats 1,000 and 10,000 in taxes

Now one has 9,000 left and the other has 90,000. Now say they both spend the same amount on taxable goods.....for ease lets make that number of taxes on their annual taxable goods $1,000.00. Now one has 8,000 left and the other has 89,000 (obviously not including the money they spent to have to pay the sales tax)....this is where you view things as getting unfair because now the effective tax rate is 20% for 10k and 11% for 100k. Please don't nitpick the numbers I used, i understand that to pay 1,000 in sales tax the poor dude would probably have to make more than 10,000, i was just trying to provide an example for discussion value .

I understand how you feel that is unfair because of that but, in the end, i still think this is far more equitable than taxing people at different rates. The income tax being equitable is not causing that imbalance, it is other taxes and individuals actual spending that does it.

 

[NYcarbineer]

To go from progressive to flat, you HAVE to lower the share the Rich pay.

Someone else has to pay that share, or you lose revenue.

For all of you who are not rich enough to benefit from the flat tax's cut for the Rich,
but will instead have to pay some of the difference that the Rich will no longer pay,

how much of that share are you personally willing to pick up?

 

[PLYMCO_PILGRIM]

Conservatives believe that one of the root causes of all our economic ills is that the poor are undertaxed and the rich are overtaxed.

It's amazing really.

Ok now that is just garbage and you know it.

The conservatives think govt is the root cause of all our economic woes. One of the fixes to these woes on the govts end, for conservatives, is lower taxes for all americans from rich to poor (like the bush tax rates did by lowering taxes on everyone with the richer getting a smaller percentage cut than the poorer). Another aspect where the govt causes problems in the economy is by getting involved in the first place....example fanny/freddy and the equal housing act which gave the banks the ability to screw us all with the housing market.

 

[PLYMCO_PILGRIM]

That low income Americans pay such low taxes was caused by Republican tax policy.

It's hilarious, because now they are stuck with it despite all their crazy ideas of how to reverse the situation.

You are right which is why I always laugh at the "bush tax cuts for the rich" comments...its because of bush's tax cuts that the poor don't pay taxes

 

[PLYMCO_PILGRIM]

10% is fair, but so long as it brings unemployment down to 5%. I would keep the unemployment tax at 0% if all they are getting is $250.00 a week. How come the max unemployment benefit in New York is $600.00? where in many states its 270/250?

the 10% figure wasn't really what I wanted to charge, I just picked 10% so when people made examples it would make the math quick and easy. It could be 10%, 15%, 20%, 25% or whatever it needs to be.

 

[Care4all]

Conservatives believe that one of the root causes of all our economic ills is that the poor are undertaxed and the rich are overtaxed.

It's amazing really.

Ok now that is just garbage and you know it.

The conservatives think govt is the root cause of all our economic woes. One of the fixes to these woes on the govts end, for conservatives is lower taxes for all americans from rich to poor. Another aspect where the govt causes problems in the economy is by getting involved in the first place....example fanny/freddy and the equal housing act which gave the banks the ability to screw us all with the housing market.

if conservatives believe in lowering taxes for the rich and the poor, why would you support a flat tax? a flat tax does raise the taxes of the poorest and the middle class and it lowers the taxes for the wealthiest....

only ONE GROUP, the wealthiest, would benefit with the lower taxes from a flat tax.????

 

[PLYMCO_PILGRIM]

In contrast, federal and state taxes on gasoline production and imports have been climbing steadily since the late 1970s and now total roughly $58.4 billion. Due in part to substantial hikes in the federal gasoline excise tax in 1983, 1990, and 1993, annual tax revenues have continued to grow. Since 1977, governments collected more than $1.34 trillion, after adjusting for inflation, in gasoline tax revenues—more than twice the amount of domestic profits earned by major U.S. oil companies during the same period.
The Tax Foundation - State and Federal Treasuries "Profit" More from Gasoline Sales than U.S. Oil Industry

This notion that the bottom 47% pay nothing is wrong, what they don't do is pay Federal " Income Taxes" , however that does not mean the bottom 47% do not contribute to the Federal tax structure in terms of Federal taxes paid for such things as fuel, household items subject to Federal taxes, travel taxes etc. There are a number of taxes the Federal Govt. levies that are passed to the consumer that are paid by that bottom 47% into the Federal coffers. So again this nation they contribute nothing is wrong. Yes it's true, that in terms of "income taxes" alone the top wage earners pay a majority of the income taxes in this nation, however what is not true is the poor pay nothing.

I wish people on both sides of the discussion would acknowledge and accept that everyone knows this. I've seen several comments that don't take that fact into account from both sides which makes it hard to discuss (because first you have to get them to see the truth)

 

[PLYMCO_PILGRIM]

This entire thread is just based on vaporware since none of the candidates tax proposals will go beyoun the wishful thinking stage.

The thread is based on the concept of a flat tax. I think we have all had some pretty good discussions so far.

We don't need to make it about one canidate's or party's plan to have it be legitimate and not be vaporware .

 

[PLYMCO_PILGRIM]

I would exempt the first $30, 000.00 and have from there upward be taxed at a flat rate, including capital gains.

The $30, 000.00 exemption would, though, include a Millionnaire's first $30k as well.

And as you might be able to see... I have broken it down to show the inequity in that scenario as well... it is just another name for the same progressive bullshit

Yeah you did show that by exempting the first XXXXXX of income you end up, even if taxes are flat, creating a system that shows a bit of progressiveness in it.

 

[Article 15]

Your point that the poorer would pay a higher percentage in income under a flat tax is just wrong. I understand why you tried to make that connection but if you actually put it onto paper, in numbers, you find that everyone is paying the same percentages still. The sales tax will still be 5% for the guy making 5 figures and the guy making 8 figures, the excise taxes on things will still be the same percentage of their values, the sin taxes will still be $xx.x/bottle for things like booze for everyone.

It's not the rate he's talking about, it's the percentage to their total income earned that he's talking about. Agreed that the percentages they are paying are the same i.e. the same sales tax rate, the same sin tax rate.....the point is that nominal value of those taxes when compared to the total income of the individual is at a higher overall percentage of their income for the poor.

 

[Navy1960]

In contrast, federal and state taxes on gasoline production and imports have been climbing steadily since the late 1970s and now total roughly $58.4 billion. Due in part to substantial hikes in the federal gasoline excise tax in 1983, 1990, and 1993, annual tax revenues have continued to grow. Since 1977, governments collected more than $1.34 trillion, after adjusting for inflation, in gasoline tax revenues—more than twice the amount of domestic profits earned by major U.S. oil companies during the same period.
The Tax Foundation - State and Federal Treasuries "Profit" More from Gasoline Sales than U.S. Oil Industry

This notion that the bottom 47% pay nothing is wrong, what they don't do is pay Federal " Income Taxes" , however that does not mean the bottom 47% do not contribute to the Federal tax structure in terms of Federal taxes paid for such things as fuel, household items subject to Federal taxes, travel taxes etc. There are a number of taxes the Federal Govt. levies that are passed to the consumer that are paid by that bottom 47% into the Federal coffers. So again this nation they contribute nothing is wrong. Yes it's true, that in terms of "income taxes" alone the top wage earners pay a majority of the income taxes in this nation, however what is not true is the poor pay nothing.

I wish people on both sides of the discussion would acknowledge and accept that everyone knows this. I've seen several comments that don't take that fact into account from both sides which makes it hard to discuss (because first you have to get them to see the truth)

Never mind, on my question there Pilgrim I found it, *lol* and it seemed simple enough to me, and needed to be pointed out.