[geeks] TAXES

[Lionel Peterson]

On May 9, 2009, at 1:48 PM, Michael Parson <mparson at bl.org> wrote:

> On Fri, 8 May 2009, Lionel Peterson wrote:
>> On May 8, 2009, at 3:08 AM, Shannon Hendrix <shannon at widomaker.com>  
>> wrote:
>
> <snip>
>
>>> But sales tax could be done too, but I've read that it can actually
>>> be hard to enforce a lot of that, and will encourage people to use
>>> black/gray markets to avoid it, and that it is not all that hard to
>>> do so.
>>
>> A high national sales tax would be hard to enforce, and would be  
>> labeled as unfair to those that spend all their income (or even  
>> more than their income) on an annual basis.
>
> The fairtax covers that base pretty well with the prebate.  The only
> paperwork you file with the federal taxing authority (the IRS, or
> whomever would take over should this tax pass), is something  
> certifying
> how many people are in your household.  Your monthly prebate is based
> on that number, not your income.  Every household of 2 adults and 2
> children would get the same prebate, which would be calculated on how
> much a family of that size would pay in taxes on neccessary goods.

I understand this would be simple to calculate, but honestly that is a  
complex solution to what is really a simple problem. The folks in  
Alabama have different income levels, different costs of goods,  
different poverty levels, etc, when compared to someone living in,  
say, manhattan. As you outlined the Fair Tax it doesn't address that  
(though it could be worked out), has the government calculating what  
the actual "cost of living" is, and has the poential for them to  
influence consumer spending in ways that I wouldn't agree with. I can  
imagine the government increasing the allowence for a new car if the  
car industry has a problem, or suddenly the list of essentials for  
living would be stretched to include digital TVs, home commputers,  
broadband internet access, a car, etc.

>
>> A flat income tax, applied to every dollar earned with refunds for  
>> the
>> first 'n' dollars would likely be viewed as fairer.
>>
>> What I mean is, rather than tax consumption at, say, 25%, tax income
>> at 15% and refund 100% of all taxes charged on the first $50k,
>> then 50% of all taxes paid on the next $50K - the refunds would be
>> automatic, as soon as you either crossed the $50K or $100K threshold,
>> or at the end of the tax year.
>>
>> This would have the desired effect of reducing paperwork, and would
>> pass the "fairness test", IMHO - a perso making $100K with a tax
>> system as I describe would pay $7,500, a $50,000/yr employee would
>> pay nothing in federal taxes, and all taxes witheld would be returned
>> immediately at the end of the year ($7,500). Of course you could
>> make refunds quarterly or at smaller thresholds (every $12.5K up to
>> $100K)...
>
> That's just a variation on the progressive tax system we have now.   
> Tax
> brackets and refunds, punishing those who make over a certain amount.
> But with less paperwork, for now...

Oh, your gonna make me feel like I wasted the 15 seconds I spent  
thinking of it. The questions really are what's fair, and what can  
pass. There are precious few ideas that pass that test.

Lionel