| Author |
Topic:
Tax Reform?
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DeathStar1977
Registered:
Jan '03
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Date Posted:
7/10/07 9:30pm
Subject:
RE: Tax Reform?
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Don't miss my point; You don't have to know anything about money to be rich...at least in Hollywood or professional sports.
But that could apply to any industry (oil and tobacco come to mind), not just 'Hollywood' or 'professional sports'...there are millions of people employed in all of these industries that know quite a lot about economics and money.
ES
Sure DS, but NY's per capita GPD is also mitigated by the tax structure of the rest of the country.
Definitely, as all cases will have mitigating factors that it would be silly to point at one statistic and call it a day. But one could make the argument that all cities are mitigated by the tax structures of the country, yet NYC still thrives while most others don't come close.
You really think a two tiered flat tax rate would be unfair? Why?
I don't think it is necessarily unfair, nor would 'fair' be my first question. My initial questions mainly would be...would it be revenue-neutral? Would it increase the tax burden on anyone?
Do you think it is fair, and if so, what benefits, as well as possible costs, would it create?
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Erk
Registered:
Aug '01
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Date Posted:
7/11/07 2:46pm
Subject:
RE: Tax Reform?
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I remember playing SimCity 2000 and when I wanted to raise the income tax to our level at 34% in municipal income tax (I think you'd call it) it stopped at 20 % and the whole town turned black. So then I had to lower it.
And how they cheered me...
until it hit like 5% when they began to boo.
My conclusion therefore is that any city's income tax should be 6%.
Hong Kong has quite a way to go.
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Ender_Sai
Title: Manager Emeritus
Registered:
Feb '01
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Date Posted:
7/11/07 2:57pm
Subject:
RE: Tax Reform?
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Well, DS, this is roughly how I'd structure it.
¡ÜUS$16,000 a year = no tax
¡ÜUS$50,000 a year = 10% tax
¡ÝUS%51,000 a year = 20% tax.
Effective tax of 10% on all goods and services purchased.
THis is off the top of my head and I haven't tweaked the numbers; but it gives you a rough idea of what I'm thinking.
Ideally, the tax rate of >50K would be capped at 20% for leaving a hefty chunk of disposable income which would be taxed through sales tax or the like.
Again, it's early and I haven't tweaked the numbers but it should set out for you a rough idea of what I would be advocating.
E_S
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Darth Mischievous
Registered:
Oct '99
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Date Posted:
7/11/07 3:11pm
Subject:
RE: Tax Reform?
- Date Edited:
7/11/07 4:01pm (1 edits total)
Edited By:
Darth Mischievous
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I'd agree with what E_S posted immediately above. I think it makes good sense, and it would eliminate a large portion of the bureaucracy with the IRS.
I understand that 10% or 20% tax rate on a 50k a year income is more financially burdensome on them than the same amount (20%) on an individual making 200k a year. However, I think a sensible rate percentage could be worked out for the broad spectrum with as fair rates as possible for all the brackets.
One would also have to eliminate the loopholes the rich have for hiding their income to seem that they're pulling in far less than what they're actually capitalizing on.
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Espaldapalabras
Registered:
Aug '05
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Date Posted:
7/11/07 3:20pm
Subject:
RE: Tax Reform?
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I support progressive tax structures, and would rather have our messy and complicated system than an across the board flat tax like the one Steve Forbes tried to sell.
One thing I would do would give $5,000 to everyone, not start taxing until they made somewhere around 15K-20K, keep the tax rate low for people under 60k, maybe 10% or something, and then tax everyone above that at least 20% if not more.
Sales taxes are in effect regressive taxes, which end up hurting the poor the most because they have to spend the highest percentage of their income on basic needs like food and transportation. A poor person might spend 15% of their income on entertainment because they have a TV and eat out once in a while, but for a rich person who has 100 million dollars to spend 15% of their income on entertainment they have to buy a yacht and a jet.
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DeathStar1977
Registered:
Jan '03
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Date Posted:
7/11/07 3:46pm
Subject:
RE: Tax Reform?
- Date Edited:
7/11/07 3:53pm (2 edits total)
Edited By:
DeathStar1977
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FYI the following is a chart of income tax rates in the US (naturally I am speaking from a US-centric perspective  ):
http://en.wikipedia.org/wiki/Income_tax_in_the_United_States#Year_2006_income_brackets_and_tax_rates
Naturally, this doesn’t include SS, Medicare or other taxes.
ES
To clarify, your proposal would be the rates you suggest, plus a sales tax. Otherwise, there would be no other federal taxes, fees, what have you (i.e. SS, Medicare, etcetera).
My next issue would be…what about the states? Would they then make their own tax rules? For example, I believe Mass already has a flat-income tax.
EDIT: Also, would it be revenue-neutral? And if so, how? My greatest concern is that while simplification is ideal, at some point here in the U.S. we are going to have to pay the piper, and to keep promising everyone a reduction in taxes as well as promised and desired expenditures (lame caveats to 'cut gov't spending' not withstanding) may sound great but it doesn't equal sound fiscal policy.
DM
One would also have to eliminate the loopholes the rich have for hiding their income to seem that they're pulling in far less than what they're actually capitalizing on.
I believe that one of the main arguments for a flat/less complicated tax system is that there is approximately $10 trillion dollars hidden in foreign banks that would otherwise be invested in the U.S…again, that is the claim and the theory along with it, I am not claiming that both are accurate.
Esp
Well said. Some have argued for a negative income tax, including Milton Friedman:
http://en.wikipedia.org/wiki/Negative_income_tax
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Ender_Sai
Title: Manager Emeritus
Registered:
Feb '01
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Date Posted:
7/11/07 4:23pm
Subject:
RE: Tax Reform?
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DS, you know how much tax I pay to the state out of my income?
Nothing.
I pay the Feds, they allocate money to the states.
Your tax system is too complex. 
E_S
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Jedi_Keiran_Halcyon
Registered:
Dec '00
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Date Posted:
7/11/07 4:53pm
Subject:
RE: Tax Reform?
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Darth Mischievous posted:
I'd agree with what E_S posted
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DeathStar1977
Registered:
Jan '03
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Date Posted:
7/11/07 5:11pm
Subject:
RE: Tax Reform?
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DS, you know how much tax I pay to the state out of my income?
Nothing.
I pay the Feds, they allocate money to the states.
Your tax system is too complex.
We also have a much bigger country population-wise (300mil to 21mil), which may or may not make a difference.
Problem is, I don’t trust our Federal gov’t to disburse money to the states, considering they do a crappy job of it already. Here in Cali we get roughly 70 cents for every dollar in taxes we send to the feds. IMO part of the reasons our state taxes are higher than most is because we have to make up for that shortfall.
Another question...when you say 'income' are you also including capital gains and such? In other words, does this mean ALL income?
Yes our tax system is too complex, but (and I think we'd agree) it would be most prudent to find the best way to change it, not just change for change's sake. After all, despite our system, our economy has been quite sound overall for the past 60 years or so.
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Ender_Sai
Title: Manager Emeritus
Registered:
Feb '01
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Date Posted:
7/11/07 5:40pm
Subject:
RE: Tax Reform?
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Which isn't a sound argument, DS, in addition to being a false hoc statement.
A revision of the ways and means of tax collection and redistribution might be a solid choker on out of control congressional spending, like the US$10bn a month spent on Iraq (  ).
I mean, you pay Federal tax, sales tax, state tax, medicare tax - what else?
E_S
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DeathStar1977
Registered:
Jan '03
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Date Posted:
7/11/07 5:44pm
Subject:
RE: Tax Reform?
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Which isn't a sound argument, DS, in addition to being a false hoc statement. A revision of the ways and means of tax collection and redistribution might be a solid choker on out of control congressional spending, like the US$10bn a month spent on Iraq
Not sure I follow you here. Are you saying we should revise our ways and means collection and redistribution? If so how? How do you guys do it in Australia?
I mean, you pay Federal tax, sales tax, state tax, medicare tax - what else?
Social Security tax, Hotel taxes, Airport taxes/fees...all sorts of various fees/taxes. Is it the same where you are or is it just straight federal taxes?
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Ender_Sai
Title: Manager Emeritus
Registered:
Feb '01
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Date Posted:
7/11/07 6:33pm
Subject:
RE: Tax Reform?
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Well, basically, for people there's simply income tax. There's a medicare levy, but you get a rebate for having private health insurance.
Most of the adult population uses PAYE - pay as you earn - to have their tax deducted from eage wage payment (eg weekly, fortnightly, monthly) as a percentage. That's it, pretty much (you have GST, capital gains etc). At the end of the FY, you fill out a tax return to match the tax you payed versus what you should have paid.
Either you paid too much or paid to little (bracket creep, variable income, whatever) and it gets redressed.
So tonight, after work, I will go home and download eTax 2007 and within 5 minutes have completed my return. Since I got a promotion 5months into the FY I paid too much tax and so I'm entitled to a return. That's it though; each fortnight when I get paid, tax and student loan payments are deducted and sent to the Tax Office. No state tax, nothing.
The tax revenue collected by the Federal Govt (income, sales, company, capital gains) is then distributed via the budget into Federal and State spending.
E_S
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Mr44
Registered:
May '02
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Date Posted:
7/11/07 6:45pm
Subject:
RE: Tax Reform?
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I thought the NSW government made a big fuss about the fairness of the GST either last year or the year before. Something about the fact that NSW contributed X amount, but only got back 90% of that amount from the federal government?
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Ender_Sai
Title: Manager Emeritus
Registered:
Feb '01
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Date Posted:
7/11/07 7:00pm
Subject:
RE: Tax Reform?
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States = Labor
Federal = Liberal
All the states want more money because they piss it away on stupid projects.
It's political.
E_S
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Lowbacca_1977
Title: Senate Moderator
Registered:
Jun '06
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Date Posted:
7/11/07 7:09pm
Subject:
RE: Tax Reform?
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Ender_Sai posted:
Well, basically, for people there's simply income tax. There's a medicare levy, but you get a rebate for having private health insurance.
Most of the adult population uses PAYE - pay as you earn - to have their tax deducted from eage wage payment (eg weekly, fortnightly, monthly) as a percentage. That's it, pretty much (you have GST, capital gains etc). At the end of the FY, you fill out a tax return to match the tax you payed versus what you should have paid.
Either you paid too much or paid to little (bracket creep, variable income, whatever) and it gets redressed.
So tonight, after work, I will go home and download eTax 2007 and within 5 minutes have completed my return. Since I got a promotion 5months into the FY I paid too much tax and so I'm entitled to a return. That's it though; each fortnight when I get paid, tax and student loan payments are deducted and sent to the Tax Office. No state tax, nothing.
The tax revenue collected by the Federal Govt (income, sales, company, capital gains) is then distributed via the budget into Federal and State spending.
E_S
That whole.... getting it taken as you work, getting back what you paid over what you should've paid for the year... all that stuff sounds exactly like taxes here, to me.
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