FLAT TAX

by Yerusalyim 49 Replies latest jw friends

Waymores Ghost

Hi Yeru,
I totally agree. It seems to me that the only FAIR way to deal with taxes is a flat tax. Financial success shouldn't be penalized.
Wg
Waymores Ghost

"We'd have to find jobs for all those tax preparers."
You sure said a mouthfull there...taxation is an "industry" unto itself.
Wg
xjw_b12

Throwing Big Tex a life preserver.
I don't know about a flat tax, but a fair tax, would be easier to swallow. Just so you in the U.S.A. don't wallow too far in self pity, here is what we contend with here in Canada.
Income Tax Rates:
Up to $35,000 16%,
$35,000 to $70,000 22%.
$70,000 to $114,000 26%
$114,000 and up 29% And these have actually dropped over the past 5 years, as the max rate used to be at 34%
On top of that, Unemployment Insurance takes 2%, Canada Pension Plan takes 5%, which is matched by the employer.
Sales Taxes.
Federal Sales Tax called the Goods and Services tax (GST) 7%. Applicable on most goods and services, except for food, unless it's a snack food.
Ontario Provincial Sales Tax 8% (PST) Applicable on most goods and services, except for food, unless it's a snack
As an example, you purchase a new car, say at $28,000, you're automatically looking at combined sales taxes at 15% of $4200.00. Most people roll this into their financing, which adds approximately $100.00 to the monthly payment.
Yerusalyim

Six,
From what I'm reading the GAO says that at 17% they'd be taking in about the same money. At 18% you take in a bit more than we currently do under this system...and drop a lot of people completely off the tax roles...shoot, I paid in over $1500 and my income is right at about that 35,000 mark.
Yes, there would be standard deductions for dependents...it's upwards of about 5grand per. Thus, a single guy making 35K would be paying on everything over 11K, somone with 6 kids and a wife would be paying in only after hitting 55K a year...or some such figure (I'd need to go back and check how that works.
imallgrowedup

SixofNine -
imallgrowedup, I gotta say, it bugs me that rem made an intelligent, honest point, and you didn't even seem to try to understand what that point was.
You know, Six, if I didn't know better, I would think that you are making the assumption that not only have I chosen to not intellectually consider Rem's post, but that I also lack the brain cells in order to do so. However, I know that you are much too *clearing throat* respectful *clearing throat again* of others on this board to imply something so rude. So, just in case there is any confusion, I want to make it perfectly clear that if, in the unlikely event you actually were implying the above, you would be categorically incorrect on both accounts. First of all, my post had nothing to do with Rem, whom, by the way, I have a great deal of respect for. However, my post had everything to do with the erroneous assumption by many that corporations - or any type of business for that matter - do not pay taxes and that consumers carry all tax burdens for this great nation of ours. Yes, it is true that most corporations/businesses pass their tax obligations on to their consumers. But one must remember that taxes are just one of several costs of doing business, just as office supplies are a cost of doing business. Corporations/businesses can not stay in business unless they set their prices high enough to cover their own expenses, and have enough left over as a profit. In fact, The Average Joe lives and dies by the same rules, although it is packaged differently. For example, how many of us can stay afloat if we are not "selling" our sweat to the highest bidder who will give us a paycheck in return so we can cover our own expenses - including our taxes? How many of us can actually save money, buy a home, or improve our home unless we can cover our expenses and have "profit" left over? No one. But here is the difference. A Corporation pays taxes whether they pass their tax bills along to the consumer or not. In fact, even if a Corporation loses money, they still have to pay what is called a "Corporation Tax" (at least in California) even if they end up in the red at the end of the year. But a consumer stops paying taxes once their income falls below a certain level. It is not that way with a Business/Corporation unless they actually go out of business or just close their doors and run, because any write-offs a Corporation/Business may incur prior to the sale of the business must be "made up" at the sale of the business. I know that for a fact because my husband and I got socked with a $25k tax bill one year after my husband sold his business for the same amount of money that he actually put into it. In other words, even though he broke even after being in business for five years, and he never drew a salary the whole time he was in business, (his ex-wife had a job outside of the business), we still owed the taxes for things he had already written off when he owned the business. (The ex got all the tax advantages, and poor pitiful me got the tax liabilities!)
The reason I am so on top of my soapbox about this is because not too long ago, I was approached by some hired-off-the-street kids who wanted me to sign a petition to "force Corporations to pay taxes". Obviously, because I have my own corporation, and I had written out my tax check just days before, I couldn't believe what my ears were hearing! I asked these students to explain what they meant, and they told me, "In California, Corporations don't pay any taxes. Only the citizens do." Their tone of voice spoke volumes over the actual words they were saying. They were quite indignant in their belief that Corporations in California could be so cold and calculating as to live off the backs of hardworking taxpayers. To say the least, this ticked me off, not only because they believed this line of bull, but because someone intentionally planted that erroneous idea in their young minds and told them to say exactly that in order to gather more signatures! Had they actually read the petition, they would have realized it was to raise Corporate taxes in the State of California! My first point in all of this, is there is a very real component of American society that actually believes that Corporations/businesses do not pay taxes, and there are some politicians out there who like the fact that they can dupe some into actually believing it so they can try to pass legislation to tax them even further! I want the record set straight here!
My second point is that the fact of the matter is that anyone who is an employee is also their own "micro company." You know that you must "charge" your employer a certain amount for your labor in order to cover your expenses, which include your taxes. If Corporations are guilty of passing their tax burdens onto the unsuspecting American public, but could go under if they didn't, then employees are also guilty of passing their own tax burdens onto their employer and could go under if they didn't. I am not trying to cite a "kettle and a pot" defense here. What I am trying to say is that passing our tax burdens along to others, whether we are a Corporation, business, or an individual, is a necessity in the American economic system, and it simply can not be avoided. As individuals, we are no less guilty than the Corporations and Businesses many point their finger at.
That, Six, is what I was trying to say. If I were rude, I would say something along the lines of how much it bugs me that it seems as if you didn't try to take the time to understand what I was trying to say. But I don't say things like that to others; it doesn't go over very well. I'm sure you can agree.
growedup
SixofNine

Now I really don't know what your point is, imallgrowedup. You seem to be agreeing with rem now.
If you meant that some people think that corporations literally do-not-pay-taxes, well then I do think you missed rem's point, as he wasn't talking simply about people uninformed in corporate tax, he was talking about the fact that if a corp is taxed, that tax has to be passed on to individuals, obviously, or the business will fail. If you agree with him, then it makes no sense for you to say you disagree.
The reason I am so on top of my soapbox about this is because not too long ago, I was approached by some hired-off-the-street kids who wanted me to sign a petition to "force Corporations to pay taxes". Obviously, because I have my own corporation, and I had written out my tax check just days before, I couldn't believe what my ears were hearing!
And obviously, whatever the kid's point was, it was a different one than rem was making.
Stacy Smith

Flat tax is a great idea. I'm not so sure it needs to be national. I'm not so sure it needs to be 18%. But no matter which way it's sliced you'll end up paying more than you pay now, it's just the way government works.
IronGland

One other thing.... as a 'rich' person I create a lot of employment for others which adds to our economic base and increases tax revenue.
"As you can tell It would be foolish of me"
imallgrowedup

Six,
Now I really don't know what your point is, imallgrowedup. You seem to be agreeing with rem now
No, what I am saying is that I don't agree with the notion that Corporations don't pay taxes! Here is what Rem said:
Corporations don't pay taxes, consumers do.
You will note that the post I made which you originally called me on was in reference to Rem's comment regarding corporations not paying taxes. Here is what I wrote:
Rem is right about Corporations not paying tax.
I beg to differ on this. I own my own corporation and I most definitely paid taxes last year! Anyone who tries to convince the public that corporations do not pay taxes is disseminating false information at best.
When I first read Rem's comment cited above, I believed he was definitively saying that Corporations do not pay taxes (period) and that his comment was another example of what I encountered with the petition-wielding kids as outlined below:
The reason I am so on top of my soapbox about this is because not too long ago, I was approached by some hired-off-the-street kids who wanted me to sign a petition to "force Corporations to pay taxes". Obviously, because I have my own corporation, and I had written out my tax check just days before, I couldn't believe what my ears were hearing! I asked these students to explain what they meant, and they told me, "In California, Corporations don't pay any taxes. Only the citizens do." Their tone of voice spoke volumes over the actual words they were saying. They were quite indignant in their belief that Corporations in California could be so cold and calculating as to live off the backs of hardworking taxpayers.
Because this scenario is by no means isolated, and I know there are millions of people who honestly believe that Corporations/Businesses do not pay taxes in this country - I believed Rem was one of those millions of people... Until he qualified this statement which did not appear until after the post I made which "bugged" you. Even though I then realized that Rem did not believe that corporations do not pay taxes, because I am so passionate about others knowing the real truth about corporate taxes, I decided to go ahead and make my point anyway, in case anyone else was confused.
Additionally, when I wrote this:
To say the least, this ticked me off, not only because they believed this line of bull, but because someone intentionally planted that erroneous idea in their young minds and told them to say exactly that in order to gather more signatures! Had they actually read the petition, they would have realized it was to raise Corporate taxes in the State of California! My first point in all of this, is there is a very real component of American society that actually believes that Corporations/businesses do not pay taxes, and there are some politicians out there who like the fact that they can dupe some into actually believing it so they can try to pass legislation to tax them even further! I want the record set straight here!
I wanted to make it clear that the source of this confusion is the politicians who would love to see Corporations taxed to just this side of bankruptcy. It is a deliberate attempt on the part of these politicians to disseminate false information, and I wanted to make sure people were aware of this so that they could not be fooled into believing it is true.
Here is the post Rem made after my first post regarding corporate taxation:
Of course I realize that corporations are charged taxes, but that doesn't mean that your corporation is actually paying them. Depending on the size of your corporation, either you personally or your customers are actually paying the tax. Larger corporations definitely move the tax burden off to their customers, which means you as a consumer are paying a hidden tax because prices are higher than they would be without taxing the corporation.
I'm not sure if it would all even out in a different way if corporations weren't taxed, but I do think it is a sneaky way of taxation.
I disagree with the two statements highlighted above, and also addressed them in my last post.
I disagree with the first statement because taxes are a part of doing business. We do not write a separate check to the IRS on behalf of the company whose product or service we are buying, nor will we see a separate listing on a receipt for "Corporate and/or Payroll tax". Some will argue that this is why it is called a "hidden tax". I say that it is not a hidden tax - it is a cost of doing business and that by virtue of giving our money to a vendor, we are allowing that company to use the money in any way they please, including to pay their taxes. Let's put this in "closer-to-home" terms. Because we are in effect, "charging" our employer for our services, (just as a company charges their customer for goods or services), we, as individuals, are independent "micro companies". This means that our employers who pay us for the services we provide them are also our "customers". Yes, our "customers" (aka: employers) take taxes out of our checks to pay taxes for us, just like we pay sales taxes, etc. to a corporation for their goods and services to pay their sales taxes. We see these taxes listed on our paychecks, just as we see any taxes we pay to a corporation for their goods or services listed on our receipts. However, if at the end of the year you still owed taxes, and you used the money your employer (aka: customer) gave you to pay those taxes, would your employer be paying "hidden taxes"? Of course not because YOU owe the bill - not your employer (aka: customer). Additionally, your employer (aka: customer) knows that once they give you money for the services you have provided them, you will use that money to meet your costs of living (aka: costs of doing business), which may include additional taxes! This point provides a perfect segue into my objection of the next statment Rem made which says that he thinks that because corporations must pay taxes, and we must pay higher prices because they are taxed, the government is being sneaky. If this were true, than any of us who use any money provided to us by our employer (aka: customer) to pay a tax bill would also be guilty of "hiding taxes" and "finding a sneaky way" to raise money for our tax bills. Therefore, my second point was:
passing our tax burdens along to others, whether we are a Corporation, business, or an individual, is a necessity in the American economic system, and it simply can not be avoided.
I hope this makes better sense.
growedup
SixofNine

rem and navigator both made the point that consumers (individuals) pay the taxes eventually, not businesses. It's a matter of profit. If you sell widgets with a razor thin profit margin of 1%, and the government comes along and adds a tax on your business that equals 2% of each of your widgets sold, you won't be able to make it up with volume, as the joke goes. You will be forced to raise prices 3% if you are going to hang on to that 1% profit. The consumer will pay that additional ~~tax~~ cost of doing business, or the company won't be in business very long. Oh look, by using the words "cost of doing business" instead of "hidden tax", we seem to agree.
passing our tax burdens along to others, whether we are a Corporation, business, or an individual, is a necessity in the American economic system, and it simply can not be avoided.
A comparison of corporations, businesses, and individuals falls apart, because a person who makes $5 per hour cannot be compared to a person who makes $100 per hour (the $100/hr worker can pay 50% in taxes and still be making 10X what the 5$ worker is making), but every business has to make a numerical value profit in order to continue functioning for very long. We don't usually use the term "profit" in the same way when talking about individuals as we do when discussing corporations, and there are very good reasons for that.

FLAT TAX

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