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Tax Reform

Discussion in 'BBS Hangout: Debate & Discussion' started by calurker, Nov 2, 2005.

  1. calurker

    calurker Member

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    I was hoping a discussion on the actual proposals being made instead of yet another income vs. sales tax thread, but whatever. :D

    For those of you who don't believe that tax avoidance would be an even bigger problem under a national sales tax regime, think about all the Chinese restaurants that currently have signs that say "Cash Only" and extrapolate that to other businesses.

    Come to think of it, I bet banks and credit card companies are strong lobbies against a national sales tax.
     
    #21 calurker, Nov 2, 2005
    Last edited: Nov 2, 2005
  2. geeimsobored

    geeimsobored Member

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    Right which is why a consumption tax run by the government as i pointed out above effectively avoids this problem. Plus if you simplify the equation to net income - (savings and investment), you also eliminate the confusing nature of the current tax structure.
     
  3. calurker

    calurker Member

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    It's much easier for a person earning $1,000,000 to put away $100,000 in savings (10%) versus a person earning $30,000 to put away $3,000. People who want a sales tax model instead of the current regime, as broken as it is, are either rich or stupid (and you know what Jack Handy says about rather be rich than stupid :D).
     
  4. geeimsobored

    geeimsobored Member

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    You're probably right but you're lying to yourself if you think the current system is somehow doing the poor a favor. We currently disproportionately tax them because they don't invest (capital gains taxes are lower than normal income tax rates) and because of deduction policies and loopholes, the rich end up getting far more advantages despite the fact that the system supposedly gives them higher rates.

    Also, corporations pay 3% of total tax revenue today. At least some type of simplified system that forces corporations to actually pay something would be helpful.

    Because politicians tried to help the rich while maintaining this supposedly fair system, we have a jumbled mess that costs millions in fees to help figure out what you have to pay via accountants. I like progressive income tax systems as well but if we don't simplify the system that determines taxable income then the massive inequalities in tax payments of the status quo will just keep going.
     
  5. FranchiseBlade

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    First we legalize drugs, and eliminate the costs of the drug war from our budget. Then we tax drugs like we do cigarettes and after we see the revenues from that we adjust the tax code accordingly.
     
  6. RIET

    RIET Member

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    How can an advanced society (so we'd like to think) cut medicaid benefits for the poor and yet eliminate the estate tax for the 2% most wealthy.

    It'd be comical if it wasn't so sad.
     
  7. Major

    Major Member

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    The problem with this is that once you start exempting things, the tax rate on everything else skyrockets. I've seen nothing that realistically projects anything less than a 25-30% sales tax rate, at the very minimum, if you take out basic necessities.

    In terms of the proposed tax plan - it does make the world simpler. But it also shifts the burden to the poor. If you eliminate the AMT (which, while projected to hit the middle classes, currently affects the rich) and substantially reduce capital gains taxes (primarily benefitting the wealthy), that burden that was on the wealthy is going to be scattered across the spectrum.
     

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