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Sat Jan 12, 2013, 05:39 PM

How would YOU restructure the federal tax code, if you could?

For myself, other than having the rich pay at the 1950's rates, I'm not totally sure.

What ideas do other DU'ers have on that?

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Reply How would YOU restructure the federal tax code, if you could? (Original post)
Ken Burch Jan 2013 OP
DogPawsBiscuitsNGrav Jan 2013 #1
ancianita Jan 2013 #2
RobertEarl Jan 2013 #18
ancianita Jan 2013 #19
RobertEarl Jan 2013 #30
theKed Jan 2013 #31
ancianita Jan 2013 #36
theKed Jan 2013 #41
ancianita Jan 2013 #45
theKed Jan 2013 #50
Warren Stupidity Jan 2013 #5
DogPawsBiscuitsNGrav Jan 2013 #7
Warren Stupidity Jan 2013 #8
DogPawsBiscuitsNGrav Jan 2013 #11
Warpy Jan 2013 #29
ThomThom Jan 2013 #25
Warpy Jan 2013 #26
burnsei sensei Jan 2013 #3
DogPawsBiscuitsNGrav Jan 2013 #4
Warren Stupidity Jan 2013 #6
DogPawsBiscuitsNGrav Jan 2013 #9
Luminous Animal Jan 2013 #12
okaawhatever Jan 2013 #17
Luminous Animal Jan 2013 #21
okaawhatever Jan 2013 #24
truebluegreen Jan 2013 #34
DogPawsBiscuitsNGrav Jan 2013 #40
truebluegreen Jan 2013 #52
okaawhatever Jan 2013 #20
ThomThom Jan 2013 #27
Warpy Jan 2013 #28
truebluegreen Jan 2013 #35
Ilsa Jan 2013 #38
Luminous Animal Jan 2013 #10
Freddie Jan 2013 #13
Luminous Animal Jan 2013 #22
Recursion Jan 2013 #14
safeinOhio Jan 2013 #15
librabear Jan 2013 #47
alittlelark Jan 2013 #51
okaawhatever Jan 2013 #16
madrchsod Jan 2013 #23
Motown_Johnny Jan 2013 #32
SoCalDem Jan 2013 #33
librabear Jan 2013 #48
Ilsa Jan 2013 #37
1-Old-Man Jan 2013 #39
Fresh_Start Jan 2013 #42
doc03 Jan 2013 #43
Wva 4-20mamp Jan 2013 #44
bigapple1963 Jan 2013 #46
jmowreader Jan 2013 #49
OneTenthofOnePercent Jan 2013 #53
FreeJoe Jan 2013 #54
B Calm Jan 2013 #55
pkz Jan 2013 #56

Response to Ken Burch (Original post)

Sat Jan 12, 2013, 05:44 PM

1. Flat tax - Everyone should pay, not just the middle class and working poor.

 

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Response to DogPawsBiscuitsNGrav (Reply #1)

Sat Jan 12, 2013, 05:46 PM

2. I could live with that.

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Response to ancianita (Reply #2)

Sat Jan 12, 2013, 07:34 PM

18. Most could not 'live with' a flat sales tax

It would be so high that everything would rise in price by as much as 20%.

Poor people would be out 20% more for the same goods.

The idea of taxing something; increasing its price, is dumb. Sales tax pushes down on demand. Our economy is a 'fill the demand' economy. No demand? No supply. Crushing demand with 20% inflationary tax rate is crazy.

Profits are where a proper tax is best levied. A company that pays employees well and fills a demand at a cost that is affordable, versus a company that rips people off creating huge profits, shows why taxing profits is the best tax scenario for our demand economy.

Capital gains are profits, too. Today, working poor people pay more in taxes than people who do nothing more than get rich from stocks.

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Response to RobertEarl (Reply #18)

Sat Jan 12, 2013, 07:44 PM

19. Is your explanation sticking with the federal income tax idea in the OP? Are sales taxes that

tightly tied to income tax? Are sales taxes even in this discussion at all?

To a flat tax I add the ending all loopholes on the income of hedge fund managers, stock exchange transactions, offshore tax evaders and all profits made in other countries no matter what those countries' tax our companies. If those incomes were all flat taxed, the poor wouldn't have to be taxed on their income at all.

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Response to ancianita (Reply #19)

Sat Jan 12, 2013, 08:14 PM

30. Never heard of flat tax on income

What we have is a progressive income tax. The more income you have, the more tax you pay.

Sales tax is progressive in that sense; the more you buy the more tax you pay. But it doesn't progress in the sense that the tax percent increases the more you buy. Progressive income tax as a percent does increase with more income.

Think of income as personal profits. In that sense a progressive income tax will take more percent with each increase in profit.

Taxing profits (income) are the opposite of taxing demand (sales). If you rip people off and take more profit, you should pay more taxes. If you supply a demand and keep prices low thereby keeping profits low, you pay less taxes and help keep demand from being crushed. Which keeps the economy alive.

The opposite of that would be taking and keeping profits out of circulation by hoarding that money and starving the economy... like what's going on these days.

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Response to ancianita (Reply #19)

Sat Jan 12, 2013, 08:14 PM

31. If the poor don't get taxed at all

nobody gets taxed at all...that's the idea of a "flat tax", that everyone pays the exact same rate.
The appeal of a progressive tax rate is that those more able to pay (at designated points of income level) pay more, and redistributes wealth downward towards those less able to pay. Closing (some) loopholes - yes. Fixing corporate and financial rates - yes. Luxury taxes - yes. Flat tax - hell no.

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Response to theKed (Reply #31)

Sat Jan 12, 2013, 09:00 PM

36. Okay. But a flat tax that denies all current corporate and financial sector loopholes such that

there would be more of the riches' income to tax would make a lower flat tax for everyone and not hurt the poor so much?

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Response to ancianita (Reply #36)

Sat Jan 12, 2013, 09:14 PM

41. Well like I say,

I'm all for closing corporate tax loopholes, diminishing corporate welfare, and such - while maintaining a progressive tax rate. The fact of the matter is that the poor have less "expendable" cash than the rich - as in, money that isn't spend on necessities - as a percentage of their total earnings. If, say, a poor person spends 70% of their income on housing, food, clothes, etc while a rich person spends 10%, with a 20% flat tax you've just taken 2/3 of a poor person's cash, and 2/9 of a rich persons. is that a fair, equitable system?

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Response to theKed (Reply #41)

Sat Jan 12, 2013, 10:09 PM

45. Nope. I guess I'm a progressive tax person. But we do already have that. So what everyone's really

talking about here is tax reform, not major restructuring. This is a pill that the bought Congress will never force their owners to swallow. These laws won't be written. I doubt they can be changed by executive order, either. So the thread should really be about ways and means.

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Response to ancianita (Reply #45)

Sat Jan 12, 2013, 11:25 PM

50. Well, there's things like

Value added taxes (VATs)
Luxury taxes
Various forms of financial transaction taxes

Frankly, the tax code is so mangled and twisted up after centuries of revisions and allowances and tinkering it's probably a good idea to trash the whole thing and start fresh...but that, of course, will never happen.

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Response to DogPawsBiscuitsNGrav (Reply #1)

Sat Jan 12, 2013, 06:00 PM

5. That would raise taxes on the working poor to draconian levels.

To match current income tax levels it would have to be at the 30-35% rate. The only people who benefit from a rightwing libertarian flat tax fantasy would, of course, be the rich, who would see their tax rate decline yet again.

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Response to Warren Stupidity (Reply #5)

Sat Jan 12, 2013, 06:21 PM

7. I'm not following you. If everyone were taxed at the same rate, that would be worse than people like

 

Romney and all these corporations paying nothing?

And please stop with the right wing crap. I'm not a zombie, I have my own thoughts and opinions. I don't have to march lock step with every talking point of one party agenda. If everyone else could think for themselves, we wouldn't have all the BS gridlock in congress right now and we might have gotten something accomplished.

You can't have an adult debate and solve anything when name calling is what you bring to the table.

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Response to DogPawsBiscuitsNGrav (Reply #7)

Sat Jan 12, 2013, 06:28 PM

8. Flat tax proposals are right wing nonsense.

I'm sorry if you don't know that, but I'd suggest google.

I explained why they hurt the working poor. To raise the current tax revenue the rate would have to be around 30-35%. That would double the lowest tax rate. It would hammer the working poor. Of course it would lower the top rate for the rich, again. Do you get yet why rightwingers love it?

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Response to Warren Stupidity (Reply #8)

Sat Jan 12, 2013, 06:34 PM

11. You really believe that if Apple, Google, Microsoft, big oil, pharma, banks, defense, and

 

everyone on the exchange all paid the same percent we do, that it wouldn't cover the revenue without us having to be taxed 30 percent?
The math doesn't add up.

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Response to DogPawsBiscuitsNGrav (Reply #11)

Sat Jan 12, 2013, 08:11 PM

29. Actually, that's the way the math does add up

It's 30%. Can you afford to send nearly a third of your paycheck to the Feds with no deductions?

Steve Forbes sure can. For him, it's a tax break.

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Response to DogPawsBiscuitsNGrav (Reply #7)

Sat Jan 12, 2013, 08:00 PM

25. people that pay little income tax because they don't make very much would be

really hard hit and the rich would pay less.
We are under taxing the rich already with low capital gains and corporate rates, they need to pay more.
We don't need to make more billionaires. Once someone makes several hundred million they should retired out of the system so someone else can have a chance.
Fairness would be good.

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Response to DogPawsBiscuitsNGrav (Reply #1)

Sat Jan 12, 2013, 08:03 PM

26. You're cool with taking food out of the mouths of the poor

but are willing to let the rich pay the same percentage, something they'd likely regard as chump change?

How very odd. How very Forbes. How very Republican.

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Response to Ken Burch (Original post)

Sat Jan 12, 2013, 05:48 PM

3. I'd make it more progressive.

nt

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Response to burnsei sensei (Reply #3)

Sat Jan 12, 2013, 05:53 PM

4. examples?

 

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Response to Ken Burch (Original post)

Sat Jan 12, 2013, 06:09 PM

6. Treat all income the same. Add more brackets back into the rates.

Capital gains and dividends get taxed the same as wages.
Add two more brackets at the top end for 250K and 400K income levels, with a top rate of 42%.
Cost of living adjust all brackets each year, and do the same for the minimum wage.

As the government would be raising more revenue, expand Medicare to everyone 55 or older, paid for from the increased tax rates, instead of using the funds to buy more useless military crap.

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Response to Warren Stupidity (Reply #6)

Sat Jan 12, 2013, 06:28 PM

9. I agree with using the revenue to fund medicare rather than useless military crap

 

but I don't agree with a top rate of 42 percent. I don't fall into this bracket but it's not right to scream that it's not fair they aren't paying the same percent we do and then in the same breath say they should have to pay more than we do.

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Response to DogPawsBiscuitsNGrav (Reply #9)

Sat Jan 12, 2013, 06:45 PM

12. I haven't problem taxing people at a rate proportionate to the wealth that they control.

Currently, the Walton family hold more wealth than 40% of their fellow citizens. That is decidedly undemocratic.

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Response to Luminous Animal (Reply #12)

Sat Jan 12, 2013, 07:34 PM

17. I disagree. their having the wealth isn't what is undemocratic. The gov't and tax system we had in p

place at the time is/was highly undemocratic. There is nothing wrong with having a ton of money. As long as you weren't given favor by the gov't or IRS to create it. Prob w/Waltons is that they possess wealth that was achieved through gross inequality in the system. That is undemocratic. And reprehensible.

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Response to okaawhatever (Reply #17)

Sat Jan 12, 2013, 07:47 PM

21. The mass accumulation & retention of wealth in the hands of a few creates

a feudal system. All power becomes consolidated and thus wielded by a few not the many. That is undemocratic.

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Response to Luminous Animal (Reply #21)

Sat Jan 12, 2013, 07:54 PM

24. Oh, I see your point, I was thinking more of how they got there. There are 2 problems, one with

wealth being so concentrated in the hands of a few, and second that a supposedly democratic system allowed them to get there.

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Response to DogPawsBiscuitsNGrav (Reply #9)

Sat Jan 12, 2013, 08:22 PM

34. They SHOULD pay a higher percentage than we do...

since they benefit disproportionately from those tax dollars.

http://dbp.idebate.org/en/index.php/Argument:_Wealthy_benefit_more_from_system,_so_owe_a_greater_tax_debt

Even if they didn't, they should pay more as the price of living in a civilized society.

And you do understand that the "top rate of 42%" is not paid on ALL of one's income, right? It's only paid on the portion above--in this example--$400,000 a year.

It's not a new or radical idea. Back in the 1950s under a Republican President the top marginal rate was more than 90% on income above the equivalent of about 3 million per year. In those days we believed in paying for our wars.

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Response to truebluegreen (Reply #34)

Sat Jan 12, 2013, 09:14 PM

40. I get what you're saying and you have a really good point but I just can't bring myself to

 

wanting to tax someone more than I have to pay for the same services. I just don't feel right about it but it burns my ass that they cheat us out of paying at least what the rest of us do.

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Response to DogPawsBiscuitsNGrav (Reply #40)

Sun Jan 13, 2013, 04:30 AM

52. But my point about disproportionate benefits

is that we don't all receive the same services.

Check out that link, it could be an eye opener.

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Response to Warren Stupidity (Reply #6)

Sat Jan 12, 2013, 07:46 PM

20. I disagree with the funding of medicare, because of where the money is going. Ex: Bush's Part D Medi

care Rx program is an example. what many don't know is that a large part of that is paid for out of the general fund (income taxes). That plan does not allow the gov't to negotiate the price of drugs the way they do with the VA or DOD. I mean c'mon the GOP added a friggin' rule that doesn't allow for free trade? I want to vomit. The GOP wants free enterprise, let's give it to them. Take part of Medicare budget and open a couple of new gov't med schools. Add a few nursing programs where free tuition and support are given in turn for working for said program for about 10 years. Same premise as Military academies. Army also has it's own med school. Let's put a little more competition in the system and see if we can't get more bang for our buck. CVS pharmacy was given 500 work visas for pharmacists last year and about 250 the year before that. Do you think their prices are going down? Heck no. They'll use tYouhe lower wage foreign workers to increase their bottom line. And while we're at it.....have you gotten meds at costco? It's about 1/2 to 1/3 rd the cost of Walgreen's etc. By law, you don't need a membership to get Rx at those places. Why isn't there a stampede? Cuz the ins. companies and drug companies have rigged it so there is no benefit to you. They have rigged it so that if you go save your insurance company $200 on meds, the difference to you is zero, zilch, nada. That is one of the most disgusting abuses of lobbying and law i've ever seen.

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Response to Warren Stupidity (Reply #6)

Sat Jan 12, 2013, 08:05 PM

27. I agree with you

I would add a top bracket where they would pay 99% if not all. Why do we need more billionaires?

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Response to Warren Stupidity (Reply #6)

Sat Jan 12, 2013, 08:09 PM

28. That's right, all income is income, even those stock options

the CEOs claim is not. So are capital gains.

All income needs to be taxed progressively so that the only thing that's taxed is disposable income, not subsistence income. The wealthy pay higher rates commensurate with their greater reliance on infrastructure, especially the imperial military infrastructure.

We can't afford low rates on the biggest greedheads. We can't afford high rates on the people who need to spend what they earn to stay alive. We need a return to a progressive tax structure.

All of this stuff was argued out a century ago and it was decided that it was the fairest way to fund the government.

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Response to Warpy (Reply #28)

Sat Jan 12, 2013, 08:24 PM

35. This.

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Response to Warren Stupidity (Reply #6)

Sat Jan 12, 2013, 09:09 PM

38. I'd be fine with most of that. nt

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Response to Ken Burch (Original post)

Sat Jan 12, 2013, 06:33 PM

10. I'd make it more deeply progressive.

Starting with a 5% rate on up to 75% rate.

Treat investment income like ordinary income.

Gradually eliminate many deductions starting with 2nd home deductions.

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Response to Ken Burch (Original post)

Sat Jan 12, 2013, 06:53 PM

13. End the SS cap -- kinda

Keep the cap ($113700) for benefits calculations, but once the cap is reached your Medicare tax increases from 1.45% to 7.65%. Thus solving the Medicare funding problem and ending the regressiveness of payroll taxes.
Capital gains taxed as ordinary income.
More "breaks" for parents of young children and for college tuition.

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Response to Freddie (Reply #13)

Sat Jan 12, 2013, 07:50 PM

22. The Medicare idea is a very good one!

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Response to Ken Burch (Original post)

Sat Jan 12, 2013, 06:58 PM

14. My dream tax system

Income is income, period.

A personal exemption up to the national median income (calculated yearly).

A flat tax above that at whatever rate roughly pays for government minus whatever we feel is an acceptable annual deficit.

A surtax on all income above twice the national median income at a rate indexed to the poverty rate; if we get to a point where nobody in the US is in poverty, the rich can have their flat tax. Alternately, index it to the Gini coefficient or perhaps the entropy of income distribution (these are less concrete than the poverty rate, but also can't be meddled with by politicians like the poverty line can).

End all payroll levies: pay for SS and Medicare out of the general fund (separate accounting isn't keeping them safe so I see no need to continue a regressive system that funds it).

This gives people an incentive to raise the national median income (to shield more money from taxes) and to distribute wealth more equally in general (to decrease the surtax).

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Response to Ken Burch (Original post)

Sat Jan 12, 2013, 07:11 PM

15. Tax wealth,

Not income. That would be progressive.

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