Then what you read is not really a flat tax but rather a restructuring of the already convoluted tax system that we have. There is nothing to be gained by flatting income taxes and leaving the thousand other convoluted rules in place. I propose a flat tax on all income. That is it, nothing else. The tax code would be a single page; maybe some more to clarify the exact meaning of income, but you get the idea. No other taxes, period.
It's still not as good as the Fair Tax, but that would be far better than what we have in place today. As I understand the Flat Tax proposals in DC though, they only flatten income taxes, they don't eliminate the other ones.
That is true but that is because politicians are not interested in a fair or flat tax. AFAIK, no one at all has submitted a fair sales tax so I am at a disadvantage with the politicians twisting a good idea to a self-serving purpose where they have not polluted yours yet
Most of congresses power comes from 2 functions (economically) they can grant cash prizes to a specific company (like Halliburton) or they can manipulate the tax code to give backers benefits and market advantages. Other than that, congress does not influence the actions of companies all that much. Most regulation is not even touched by congress and instead handled by various agencies. The first method is effective but dirty and leaves the politicians open to a LOT of criticism and ire as well as convoluted laws. The second (manipulation of the tax code) is very discrete. Essentially, congress is simply paying lip service to two groups (the ones that want simple taxes and the ones that are upset at those that do not pay taxes) but they dont want actual change. If that happened, they would be neutered in their ability to pay the lobbies and backers back.
I dont really care whether the investment tax is good for the economy...
This section is really for the Flat Tax or Fair Tax versus the current code, it's not the Flat Tax versus the Fair Tax.
Maybe I got confused, but I thought you said investment taxes would be subject to the Flat Tax. If not, then I concur and it does eliminate a lot more double taxation. If they are subject to the Flat Tax, then it is clearly double taxation since the company already paid taxes on that income.
Only under the current system. Remember, I believe that a flat tax should be devoid of corporate tax altogether. To me, that is simply another hidden tax. The consumers pay it anyway but they never see it. One of the things that I despise about the current tax code is that the vast majority of taxes simply are hidden. Its not true that the bottom rung pays no income tax it is just hidden in the employer side of the paystub. That is asinine to me as the only real point to doing this is so the politicians can levy a tax on people without them actually knowing it and then they blame the companies for the low pay. Part of the reason that pay is low is because the employer is paying a lot more than the workers think.
As an argument against the current system, the statements against double taxation make sense but I dont think there is a real argument there. I think that we both seem to really despise the current system so there is not going to be much debate as to whether or not a piece of that is effective or good.
If it is double taxed under the system that I propose, please show me how.
There are a lot more people doing work for cash then selling products without paying sales taxes. The ones working for cash now are not paying income tax, but they would pay the Fair Tax. The ones who would sell cigarettes out of their trunk to avoid the Fair Tax are already doing it to avoid current taxes.
Again, I can point out illegal ways to do this all day, neither system is full proof from fraud. Pretending that a flat sales tax is going to end fraud is ludicrous.
Nice strawman there, I never said it would "end" fraud.
Ill give you that. My point is that fraud is going to happen. I disagree that it is more prevalent with an income system rather than a sales system because of the extra loopholes that exist for items that are used to make another product. Even if it is, I would not structure a major change because of relatively little fraud. If it is a problem, prosecute those that are guilty.
Sure they do. That is irrelevant. You were specifically talking about corporate tax structures (at least that is what I gathered from that specific point). They are STILL not paying more than foreign companies though, that is a misnomer. Even if they are, it is STILL irrelevant. I have already addressed this fact. Stop reverting back to the same argument without addressing my counter.
Can you clarify what point I didn't respond to? We've had a lot of discussion, I didn't pass on anything intentionally.
That overseas competition should not be evened out with the tax code. As I stated, all taxes should have a single purpose, to fund the government. That is, IMHO, the only power that the federal government has as far as taxing. I dont think that the purpose of that power was ever to control the markets. Foreign competition should be handled by another power the power to form treaties and international agreements. IOW, levy import fees if there is a disparity between tax here and tax there. Lets face it, taxing changes are simply not going to solve that anyway as they still have no EPA or labor law to deal with so even taxes at zero all around would not keep companies here or put them on even footing. That does not even address the fact that some governments back their companies in other ways as well. Rather than structure the tax code around foreign competition and offshoring, use trade agreements for that.
I understand there are consequences to that as well but tbh, we are already paying much of those consequences. I believe that free trade is anything but and the concept is rather asinine but that is for another thread. It is not as though other nations would not react in a similar fashion anyway if they see their companies paying a sales tax and that was making trade difficult.
