Simplifying the Tax System Is Easy in the Real World

[my2¢]

For 2017 I foresee the wife and I forking over to the IRS 18.3% of our total income. If that sample rate was 20% instead of 10%, that would make for an unhappy situation for me. Moreover, next year when I estimate that the percentage under current tax law will be reduced to 12.3% (due to my retirement) in which a 20% fixed rate would have me downright irate.

I see the logic, but let's talk reality. At what tax percentage would you say that this flat tax, using one of my pop's WWII expressions, is shit for the birds?

 

[Weatherman2020]

There are three main reasons why I support replacing the income tax with the Fair Tax.

1) It is harder to hide a tax increase, and EVERYONE is affected by it. So if you want the government to give free puppies to hookers, then EVERYONE has to pay for it.

2) It is a tax on consumption rather than a tax on production (income tax).

3) It is more politically difficult to give a rich guy a Fair Tax exemption for buying a yacht.

So I'll just buy my yacht in Mexico.

You'll move your consumption to Mexico. The same way production has moved to Mexico under our current system.

Yeah, and everyone who makes and sells boats in America will be out of work.

How quickly you have forgotten the narrative that our manufacturing jobs have already gone overseas!

You think jobs are not going offshore?

 

[g5000]

No, you're an idiot for bleeving a flat tax has a magical property which takes away Bill Gates' current tax write-offs.

He would pay even LESS under a flat tax system than he does now.

What percentage flat tax would allow Gates to pay less then? Prove your point.

Prove my point?

It's simple math, fool!

Imagine Gates has a 39 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay.

Now imagine Gates has a 15 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay .

DUH!

I'm using even numbers to simplify things.
Let's say Gates paid $1M in tax last year. He grossed $100M but paid that tax on $10M after deductions.

So a flat tax of 1% on his gross would have him paying the same exact taxes he did last year.

See? You rubes ASSUME there would be no deductions in a flat tax.

You have deliberately been led to believe a flat tax has this magical property.

Now who do you suppose wants you to believe this giant hoax?

The people who would benefit the most from your innumeracy and gullibility.

The OP said no deductions.
Don't insert your own system into mine. Worst strawman possible.

Yes, I know you said no deductions. But that is not what will happen in real life.

You are being led to believe that is what would happen by the people who would benefit the most.

So a flat tax is not the cure.

Banning tax expenditures is.

 

[Weatherman2020]

For 2017 I foresee the wife and I forking over to the IRS 18.3% of our total income. If that sample rate was 20% instead of 10%, that would make for an unhappy situation for me. Moreover, next year when I estimate that the percentage under current tax law will be reduced to 12.3% (due to my retirement) in which a 20% fixed rate would have me downright irate.

I see the logic, but let's talk reality. At what tax percentage would you say that this flat tax, using one of my pop's WWII expressions, is shit for the birds?

You are forgetting you pay taxes on net income, not gross.

 

[g5000]

There are three main reasons why I support replacing the income tax with the Fair Tax.

1) It is harder to hide a tax increase, and EVERYONE is affected by it. So if you want the government to give free puppies to hookers, then EVERYONE has to pay for it.

2) It is a tax on consumption rather than a tax on production (income tax).

3) It is more politically difficult to give a rich guy a Fair Tax exemption for buying a yacht.

So I'll just buy my yacht in Mexico.

You'll move your consumption to Mexico. The same way production has moved to Mexico under our current system.

Yeah, and everyone who makes and sells boats in America will be out of work.

How quickly you have forgotten the narrative that our manufacturing jobs have already gone overseas!

You think jobs are not going offshore?

Some are going offshore. But the vast majority of lost jobs (80 percent) have been made obsolete by technology. They are never coming back. Ever.

 

[AntonToo]

No, you're an idiot for bleeving a flat tax has a magical property which takes away Bill Gates' current tax write-offs.

He would pay even LESS under a flat tax system than he does now.

What percentage flat tax would allow Gates to pay less then? Prove your point.

Prove my point?

It's simple math, fool!

Imagine Gates has a 39 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay.

Now imagine Gates has a 15 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay .

DUH!

I'm using even numbers to simplify things.
Let's say Gates paid $1M in tax last year. He grossed $100M but paid that tax on $10M after deductions.

So a flat tax of 1% on his gross would have him paying the same exact taxes he did last year.

See? You rubes ASSUME there would be no deductions in a flat tax.

You have deliberately been led to believe a flat tax has this magical property.

Now who do you suppose wants you to believe this giant hoax?

The people who would benefit the most from your innumeracy and gullibility.

The OP said no deductions.
Don't insert your own system into mine. Worst strawman possible.

If your problem is deductions then why the hell are you pushing flat tax?

All flat tax ITSELF does is shift burden from rich to poor and middle class

 

[Weatherman2020]

If there was no tax on production, then things would get made here.

If you want to buy a yacht, you would have to buy it from where it is made.

HERE!

So no one in America can buy a TV?

That is what you are saying. No one makes TV's in America now.

 

[pinqy]

Unfortunately the DC elitists require everything be so complex and you need to hire lawyers for everything so they can maintain control over you.

A flat tax on gross income, no deductions. Period.

You earn X dollars, you pay a percentage. Same percentage for all. I have no idea what that percentage should be, but for the sake of discussion say it is 10%. You earn $100,000, you pay $10,000. You earn $1,000 you pay $100.

But weatherman, the lowest earners are paying the same percentage as millionaires!

Yep. Everyone has a vested interest in America. The same vested interest on how America does.

Except...

Table 1203. Income before taxes: Annual expenditure means, shares, standard errors, and coefficients of variation, Consumer Expenditure
Survey, 2015

In 2015, the percent of pre-tax income spent only on food and housing was as follows:
< $15,000: 162.3%
$15,000 - $29,999: 72.8%
$30,000 - $39,999: 55.4%
$40,000 - $49,999: 45.6%
$50,000 - $69,999: 40.2%
$70,000 - $99,999: 35.2%
$100,000 - $149,999: 30.4%
$150,000 - $199,999: 27.4%
$200,000+ : 20.1%

You don't have to be an Economist to figure out that a flat tax would have a disproportionately negative effect on lower income groups. Especially keeping in mind that for those who make less than $30,000 their post-tax income is actually higher than pre-tax.

Spending an extra 10% on taxes will not affect any of the necessities of life for higher incomes, but absolutely will for lower incomes.

 

[g5000]

All those coal jobs Trump promised the rubes in West Virginia he would bring back?

Massive hoax.

 

[Weatherman2020]

What percentage flat tax would allow Gates to pay less then? Prove your point.

Prove my point?

It's simple math, fool!

Imagine Gates has a 39 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay.

Now imagine Gates has a 15 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay .

DUH!

I'm using even numbers to simplify things.
Let's say Gates paid $1M in tax last year. He grossed $100M but paid that tax on $10M after deductions.

So a flat tax of 1% on his gross would have him paying the same exact taxes he did last year.

See? You rubes ASSUME there would be no deductions in a flat tax.

You have deliberately been led to believe a flat tax has this magical property.

Now who do you suppose wants you to believe this giant hoax?

The people who would benefit the most from your innumeracy and gullibility.

The OP said no deductions.
Don't insert your own system into mine. Worst strawman possible.

If your problem is deductions then why the hell are you pushing flat tax?

If your problem is deductions then why the hell are you pushing flat tax?

That absolutely makes no sense whatsoever.

 

[g5000]

If there was no tax on production, then things would get made here.

If you want to buy a yacht, you would have to buy it from where it is made.

HERE!

So no one in America can buy a TV?

That is what you are saying. No one makes TV's in America now.

You are buying TVs from where they are made.

If there were no taxes on production here, more things would get made here and you would buy them from here.

However, a lot of manufacturing is low skilled shit. It shouldn't be made here.

 

[Weatherman2020]

Unfortunately the DC elitists require everything be so complex and you need to hire lawyers for everything so they can maintain control over you.

A flat tax on gross income, no deductions. Period.

You earn X dollars, you pay a percentage. Same percentage for all. I have no idea what that percentage should be, but for the sake of discussion say it is 10%. You earn $100,000, you pay $10,000. You earn $1,000 you pay $100.

But weatherman, the lowest earners are paying the same percentage as millionaires!

Yep. Everyone has a vested interest in America. The same vested interest on how America does.

Except...

Table 1203. Income before taxes: Annual expenditure means, shares, standard errors, and coefficients of variation, Consumer Expenditure
Survey, 2015

In 2015, the percent of pre-tax income spent only on food and housing was as follows:
< $15,000: 162.3%
$15,000 - $29,999: 72.8%
$30,000 - $39,999: 55.4%
$40,000 - $49,999: 45.6%
$50,000 - $69,999: 40.2%
$70,000 - $99,999: 35.2%
$100,000 - $149,999: 30.4%
$150,000 - $199,999: 27.4%
$200,000+ : 20.1%

You don't have to be an Economist to figure out that a flat tax would have a disproportionately negative effect on lower income groups. Especially keeping in mind that for those who make less than $30,000 their post-tax income is actually higher than pre-tax.

Spending an extra 10% on taxes will not affect any of the necessities of life for higher incomes, but absolutely will for lower incomes.

47% or so of Americans do not pay Federal taxes. They have no vested interest in how America does?

 

[g5000]

Prove my point?

It's simple math, fool!

Imagine Gates has a 39 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay.

Now imagine Gates has a 15 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay .

DUH!

I'm using even numbers to simplify things.
Let's say Gates paid $1M in tax last year. He grossed $100M but paid that tax on $10M after deductions.

So a flat tax of 1% on his gross would have him paying the same exact taxes he did last year.

See? You rubes ASSUME there would be no deductions in a flat tax.

You have deliberately been led to believe a flat tax has this magical property.

Now who do you suppose wants you to believe this giant hoax?

The people who would benefit the most from your innumeracy and gullibility.

The OP said no deductions.
Don't insert your own system into mine. Worst strawman possible.

If your problem is deductions then why the hell are you pushing flat tax?

If your problem is deductions then why the hell are you pushing flat tax?

That absolutely makes no sense whatsoever.

It is a totally legitimate question to anyone who is not innumerate.

 

[Weatherman2020]

If there was no tax on production, then things would get made here.

If you want to buy a yacht, you would have to buy it from where it is made.

HERE!

So no one in America can buy a TV?

That is what you are saying. No one makes TV's in America now.

You are buying TVs from where they are made.

If there were no taxes on production here, more things would get made here and you would buy them from here.

However, a lot of manufacturing is low skilled shit. It shouldn't be made here.

Except Democrats oppose reducing the taxes on manufacturing in America.

 

[Weatherman2020]

All those coal jobs Trump promised the rubes in West Virginia he would bring back?

Massive hoax.

Showing a graph that goes to the end of the Obama error has nothing to do with the OP, stay on topic. FOCUS.

 

[pinqy]

Unfortunately the DC elitists require everything be so complex and you need to hire lawyers for everything so they can maintain control over you.

A flat tax on gross income, no deductions. Period.

You earn X dollars, you pay a percentage. Same percentage for all. I have no idea what that percentage should be, but for the sake of discussion say it is 10%. You earn $100,000, you pay $10,000. You earn $1,000 you pay $100.

But weatherman, the lowest earners are paying the same percentage as millionaires!

Yep. Everyone has a vested interest in America. The same vested interest on how America does.

Except...

Table 1203. Income before taxes: Annual expenditure means, shares, standard errors, and coefficients of variation, Consumer Expenditure
Survey, 2015

In 2015, the percent of pre-tax income spent only on food and housing was as follows:
< $15,000: 162.3%
$15,000 - $29,999: 72.8%
$30,000 - $39,999: 55.4%
$40,000 - $49,999: 45.6%
$50,000 - $69,999: 40.2%
$70,000 - $99,999: 35.2%
$100,000 - $149,999: 30.4%
$150,000 - $199,999: 27.4%
$200,000+ : 20.1%

You don't have to be an Economist to figure out that a flat tax would have a disproportionately negative effect on lower income groups. Especially keeping in mind that for those who make less than $30,000 their post-tax income is actually higher than pre-tax.

Spending an extra 10% on taxes will not affect any of the necessities of life for higher incomes, but absolutely will for lower incomes.

47% or so of Americans do not pay Federal taxes. They have no vested interest in how America does?

According to the Census Population Clock, in July the total population in the U.S. was 325,365,189
According the Bureau of Labor Statistics Table A1, the total number of people age 16+ (excluding military and prison labor) who were working was 153,513,000
So that's over 50% of the population not working. That doesn't mean no income, but it does raise the question of where you think all those not currently paying Federal taxes would get the money from?

 

[my2¢]

For 2017 I foresee the wife and I forking over to the IRS 18.3% of our total income. If that sample rate was 20% instead of 10%, that would make for an unhappy situation for me. Moreover, next year when I estimate that the percentage under current tax law will be reduced to 12.3% (due to my retirement) in which a 20% fixed rate would have me downright irate.

I see the logic, but let's talk reality. At what tax percentage would you say that this flat tax, using one of my pop's WWII expressions, is shit for the birds?

You are forgetting you pay taxes on net income, not gross.

What do you mean? In your flat tax scenario I assumed both net and gross were the same. I know when Steve Forbes and others proposed their "flat tax" legislation they had an exemption of something like the first $25,000 being tax free which incorporated a good measure of progressiveness for the vast majority. I didn't see anything like that in your scenario.

Or if you mean in the calculation of my own tax percent, I simply took my total tax liability (figuring in deductions and personal exemptions allowed in current law) and divided it by my gross income. It is something I already had at hand in form of an Excel spreadsheet I prepared to determine how much I should withhold for federal tax on my paycheck (now pension) check. I like to keep my interest free loans to the government at a minimum.

 

[nat4900]

The Baltic countries of Estonia, Latvia and Lithuania have had flat taxes of 24%, 25% and 33% respectively with a tax exempt amount, since the mid-1990s. On 1 January 2001, a 13% flat tax on personal income took effect in Russia. Ukraine followedRussia with a 13% flat tax in 2003, which later increased to 15% in 2007.

.....and here I thought that right wingers like the O/Posters were not too pleased with "Socialism".

 

[AntonToo]

Prove my point?

It's simple math, fool!

Imagine Gates has a 39 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay.

Now imagine Gates has a 15 percent income tax rate, and is allowed a million dollars in deductions before calculating how much tax he must pay .

DUH!

I'm using even numbers to simplify things.
Let's say Gates paid $1M in tax last year. He grossed $100M but paid that tax on $10M after deductions.

So a flat tax of 1% on his gross would have him paying the same exact taxes he did last year.

See? You rubes ASSUME there would be no deductions in a flat tax.

You have deliberately been led to believe a flat tax has this magical property.

Now who do you suppose wants you to believe this giant hoax?

The people who would benefit the most from your innumeracy and gullibility.

The OP said no deductions.
Don't insert your own system into mine. Worst strawman possible.

If your problem is deductions then why the hell are you pushing flat tax?

If your problem is deductions then why the hell are you pushing flat tax?

That absolutely makes no sense whatsoever.

Yes it does, but you need a brain for that.

FLAT TAX of your proposal just shifts tax burden from rich to others and only the REMOVE DEDUCTIONS part of it does what you say you want to accomplish.

That REMOVE DEDUCTION part can be implemented just fine in current progressive system, which makes your push for FLAT TAX pointless.

 

[g5000]

I'm using even numbers to simplify things.
Let's say Gates paid $1M in tax last year. He grossed $100M but paid that tax on $10M after deductions.

So a flat tax of 1% on his gross would have him paying the same exact taxes he did last year.

See? You rubes ASSUME there would be no deductions in a flat tax.

You have deliberately been led to believe a flat tax has this magical property.

Now who do you suppose wants you to believe this giant hoax?

The people who would benefit the most from your innumeracy and gullibility.

The OP said no deductions.
Don't insert your own system into mine. Worst strawman possible.

If your problem is deductions then why the hell are you pushing flat tax?

If your problem is deductions then why the hell are you pushing flat tax?

That absolutely makes no sense whatsoever.

Yes it does, but you need a brain for that.

FLAT TAX of your proposal just shifts tax burden from rich to others and only the REMOVE DEDUCTIONS part of it does what you say you want to accomplish.

That REMOVE DEDUCTION part can be implemented just fine in current progressive system, which makes your push for FLAT TAX pointless.

The House Republican tax reform proposal does this very thing. It addresses the tax expenditure problem, which is why I like it even though it preserves some giant deductions.

Better to have four-fifths of a slice than no slice.