eagle1462010
Diamond Member
- May 17, 2013
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I addressed the VAT already and how it's different than the Fair Tax, I'm not going to do it again. I'm not knocking you for asking and I don't expect you to read the whole conversation before posting, I'm just letting you know.
As for the income tax, when you say my examples are not affected by the income tax, of course they are, think about it.
- Your flat tax for example helps foreign companies over American
Employers have to pay employees enough to live and enough to pay their taxes. So if you tax all products equally, then you're agnostic as to where they are made. By taxing income, you are taxing American companies more than foreign companies in general because we have more employees here. That income is paid to the employee by their employer, and embedded in the price of the product.
- Companies that automate over those that hire employees
You automate, your employees salaries, and your employees taxes go away. That means you can charge less than companies that don't.
- Companies that offshore production over keep production in the US.
Same thing again, you move production off shore, your employee salary goes away, and their taxes.
It's undeniable. All taxes are taxes on economic activity. So clearly, the flattest tax of all is a flat tax on economic activity. That way we focus not on avoiding the tax man but just driving efficiency based on economics.
Corporate Taxes are a different entity to me. I understand where you are going, but
If I make $30 an hour at a company to work now, I still make $30 an Hour irregardless of the Tax Code.
So if it goes to a Flat tax, I'll still make $30 an hour but pay the Federal Tax at 15%.
I don't see through to your point.
I wasn't talking about corporate taxes. Your company has to pay you enough to pay your income taxes. Your salary is not calculated regardless of the taxes you pay.
Let's say you got a graduate degree, work experience and are reliable.
Joe didn't do any of that. You're worth three times what Joe is.
Your expected tax rate is 25%. Joe's is 0%.
Joe makes $10 an hour.
Well, you then have to make $40 an hour. You pay 25% tax, and you get the $30 an hour that is three times Joe.
If your company does not pay you $40 an hour, then you will not work for them. You're three times as valuable as Joe economically. You're not going to work for $30 and just give 25% of what you're worth to the government.
Your company collects that money from their customers, it's baked into the price of their product. If they can't, they go bust.
So, your company can do that, or they can go off shore or they can automate. Or an overseas competitor who doesn't have to pay $10 an hour to you to pay your taxes can beat them.
Money does not appear from nowhere and it doesn't go nowhere.
That's absurd. You are pulling numbers out of no where. If I'm making $30 now and pay taxes I'll make the same under the new law. Taxation rates don't set your pay scale.
You are also using prorated data. I said nothing about that. The 15% tax rate would hardly change my net income at all if it happened right now. Either way I pay taxes, it's just that one is simple and one requires some time filing my taxes.
I prefer the simple way. It's not going to affect my pay scale.