What type of tax is best economicly?

[Mike AI]

Bush wants tax reform. I tend to lean towards the flat tax idea, though some kind of conumption tax would be ok as well. If its going to be real reform, its going to be very difficult to get past. The idea of closing the IRS is a major change.

http://www.foxnews.com/story/0,2933,137864,00.html

Alex I guess you are for more "progressive" taxs....

[Winetalk.com]

Mike,
how consumption tax will affect retirees like I am???

I paid all my income taxes already and now ON TOP OF IT,
I gotta pay "consumption tax"?

[RawAlex]

Mike, looking for "ONE TAX" to solve all the problems isn't going to work.

The IRS right now is a joke, eating up huge amounts of tax income just to keep itself going.

End user fees are a good place to start. Increase the costs for things like building permits, fishing licenses, etc. Basically, the government should make as many of it's own departments self supporting as possible. Paying $5 for a fishing license that cost $25 of manpower to produce is a waste. There would not be significantly less people with licenses if the price went up.

Increase the costs of license plates, drivers licenses, and such. Again, attempt to make the processes more self supporting. $10 or $25 for a driver's license that in itself takes $100 to produce is nuts.

Basically, make government services more expensive for the people who use them, and the turn around and cut everyone's tax rate.

(oh yeah, at the end of all of this, the fines for NOT having the right permit, license, whatever should go up accordingly. The risk / reward scenerio should always be adjusted to make sure people are not encouraged just to bypass things).

Flat taxes on income are nice. Simplification and removal of potential loopholes is another good step. Most loopholes exist because someone tried to write the rules to favor one group or another, political actions rather than good sense. Strip those things away and look at the basics, then start over.

Alex

[Almighty Colin]

Depends on what you mean by "economically". What is the goal? To maximize tax receipts? Minimize tax recipts? Have the most "fair" tax system?

[Opti]

tax credits for savings/investments, less tax on income and more tax on spending.

[RawAlex]

Opti, you have to be careful encouraging too much savings, that is one of the problems that has wrecked the economy of Japan... too much money taken out of real circulation each year.

Alex

[Vick]

Pssss ....

I've already given the solution at length some months ago right here at Oprano

National Sales Tax
- excluding grocery store food items and single clothing items under $50

The tax rate can be adjusted to ensure the national budget is balanced (think how that would effect thinking) and funds that are "hidden" will start to be taxed

It's beautiful and simple,
I don't know what fair is or means so forget fair

[Buff]

A tax raises the costs associated with the behavior being taxed.

An income tax raises the costs associated with generating income.
A sales tax raises the costs associated with engaging in trade.
A property tax raises the costs of owning property.
A luxury tax raises the costs associated with owning luxury items.
A capital gains tax raises the costs associated with investing.
A tariff raises the costs associated with imports.

And so on.

In this respect, taxes end up being a form of social engineering, as they distort people's incentive structures -- the benefits of engaging in behavior a, ceteris paribus, remain the same, but the costs are now higher -- people change their behavior accordingly.

Like Colin pointed out, do we want to maximize receipts or minimize them or what? As a libertarian, clearly I think the less government intervention we have in our lives, the better, so we should cut spending and tax very little.

So the question is what behavior is the best to tax? Well, since I pointed out that taxation amounts to social engineering, I think we should tax behaviors that we wish to discourage, and not tax behavior we wish to encourage.

I don't think it's a good idea to discourage income generation, investment, property ownership, importing, luxury, or trade.

I would rather tax poverty, illiteracy, practicing law, passing legislation, running for public office, or driving slow in the fast lane.

[*KK*]

Consumption taxes are so not the way to go. It punishes those who've got the power to consume in greater quantities at the expense of those who make the goods that don't get sold due to the consumption tax.

Frankly, the only tax I know of that works well (at least currently) is here in California, and its the tax imposed on boaters for the ownership and use of their boats.

All the money from the tax is spent by the Dept of Waterways and Harbors, I think it's called, so it's a self-contained little system.

[Almighty Colin]

Originally posted by Buff@Nov 8 2004, 12:58 PM
I would rather tax poverty
Buff,

How do you tax poverty?

[Buff]

Originally posted by *KK*@Nov 8 2004, 12:21 PM
Frankly, the only tax I know of that works well (at least currently) is here in California, and its the tax imposed on boaters for the ownership and use of their boats.


See above. I would tax poverty and illiteracy out of existence. It would be too costly to be poor or illiterate. Talk about encouraging a work ethic and a quest for knowledge.

[Buff]

Originally posted by Colin+Nov 8 2004, 12:24 PM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (Colin @ Nov 8 2004, 12:24 PM)</td></tr><tr><td id='QUOTE'> <!--QuoteBegin-Buff@Nov 8 2004, 12:58 PM
I would rather tax poverty
Buff,

How do you tax poverty? [/b][/quote]
You don't think the poor have ever been taxed?

You tax their income and property just like is currently done to everyone else, and then throw them in jail when they've nothing left to give. As long as prison conditions are kept miserable enough, the poor would work 4 jobs if they had to in order to get out of the tax bracket.

[Almighty Colin]

Buff,

I've been poor. I found the whole experience to be disincentive enough.

Why do you want to eradicate poverty? Why not just let there be haves and have-nots?

[Buff]

Originally posted by Colin@Nov 8 2004, 01:04 PM
Buff,

I've been poor. I found the whole experience to be disincentive enough.

Why do you want to eradicate poverty? Why not just let there be haves and have-nots?
We're talking about the ideal form of taxation. I think we should tax behaviors we wish to discourage if we have to tax something. What would YOU prefer to discourage more than poverty and illiteracy and practicing law and passing legislation and running for office?

[Almighty Colin]

Originally posted by Buff@Nov 8 2004, 02:52 PM
What would YOU prefer to discourage more than poverty and illiteracy and practicing law and passing legislation and running for office?
Using your rules, I'd have to tax the IRS itself.

[Hell Puppy]

Originally posted by Vick@Nov 8 2004, 12:49 PM
Pssss ....

I've already given the solution at length some months ago right here at Oprano

National Sales Tax
- excluding grocery store food items and single clothing items under $50

The tax rate can be adjusted to ensure the national budget is balanced (think how that would effect thinking) and funds that are "hidden" will start to be taxed

It's beautiful and simple,
I don't know what fair is or means so forget fair
I'm in this camp as well.

The infrastructure to collect sales tax already exists in almost all of the states. And it eliminates almost all of the expense and overhead associated with the IRS. So it costs little to implement and saves a ton of money.

And everyone gets taxed when they use the money, thieves, drug dealers, foreign companies.

[RawAlex]

Hell Puppy, sales tax only just encourages people to work off the books all the time. You need to come to Quebec, where there is more than 15% sales tax - it isn't hard to find someone willing to work partially or completely in cash, it is a very normal question.

I went shopping a couple of years back with a visitor to Montreal. Go to the store, fidn what he was looking for, ask the price. $200, tax in. How much for cash? $160. How much for US cash? $110.

It all depends how you ask the question.

Thus, a sales tax as the only source of government revenue is, well, just not going to work out.

Alex

[Hell Puppy]

Originally posted by RawAlex@Nov 9 2004, 12:34 AM
Hell Puppy, sales tax only just encourages people to work off the books all the time. You need to come to Quebec, where there is more than 15% sales tax - it isn't hard to find someone willing to work partially or completely in cash, it is a very normal question.

I went shopping a couple of years back with a visitor to Montreal. Go to the store, fidn what he was looking for, ask the price. $200, tax in. How much for cash? $160. How much for US cash? $110.

It all depends how you ask the question.

Thus, a sales tax as the only source of government revenue is, well, just not going to work out.

Alex
Interesting point.

There are enough positives though that I dont think you take the idea off the table just because a few people will evade it. There's no tax scheme that cant be dodged.

Anything that eliminates withholdings (a measure implemented temporarily to use to fight World War II) is a step in the right direction if for no other reason than it makes people better understand taxes and how much they pay.

It's amazing how many people have no concept of just how much they pay in taxes because it is peeled right off their payroll check. Ask 'em how much they paid in taxes last year and over half of them will respond "Nothing! I actually got some back!". The government makes sure the defaults insure you over pay...otherwise a large percentage of the country could never scrape up even $2-3K of unantcipated tax expense.

[Almighty Colin]

Originally posted by RawAlex@Nov 9 2004, 12:34 AM
Hell Puppy, sales tax only just encourages people to work off the books all the time. You need to come to Quebec, where there is more than 15% sales tax - it isn't hard to find someone willing to work partially or completely in cash, it is a very normal question.

I went shopping a couple of years back with a visitor to Montreal. Go to the store, fidn what he was looking for, ask the price. $200, tax in. How much for cash? $160. How much for US cash? $110.

It all depends how you ask the question.

Thus, a sales tax as the only source of government revenue is, well, just not going to work out.

Alex
Wow, people carry cash????

[Buff]

Originally posted by RawAlex@Nov 8 2004, 11:34 PM
Hell Puppy, sales tax only just encourages people to work off the books all the time. You need to come to Quebec, where there is more than 15% sales tax - it isn't hard to find someone willing to work partially or completely in cash, it is a very normal question.

I went shopping a couple of years back with a visitor to Montreal. Go to the store, fidn what he was looking for, ask the price. $200, tax in. How much for cash? $160. How much for US cash? $110.

It all depends how you ask the question.

Thus, a sales tax as the only source of government revenue is, well, just not going to work out.

Alex
Yup. And the higher the tax rates, the more people are willing to circuvent the law -- that's what I was explaining above about the way people's incentive structures get distorted.

[Sharpie]

I find it hard to believe that anything drastic to really simplify things, will ever be done.

Do you really think they would cut back IRS employees? Can't imangine that...... and put most of the accountants out of biz? My what a simplier world..... makes way too much sense to ever happen.

[Almighty Colin]

Originally posted by Sharpie@Nov 9 2004, 08:02 AM
I find it hard to believe that anything drastic to really simplify things, will ever be done.

Do you really think they would cut back IRS employees? Can't imangine that...... and put most of the accountants out of biz? My what a simplier world..... makes way too much sense to ever happen.
I think most of this was under Clinton.

"During the past decade, its force (The IRS) of auditors has shrunk nearly in half, and the number of investigators is a third less, though total tax filings rose 14%.

" Since the late 1990s, the IRS cut about a quarter of its agents, auditors and investigators "

"Due to staff cutbacks the IRS has just 78 lawyers available to audit more than 3,300 gift tax returns filed by wealthy individuals. "

[Buff]

Originally posted by Colin+Nov 9 2004, 07:19 AM--></div><table border='0' align='center' width='95%' cellpadding='3' cellspacing='1'><tr><td>QUOTE (Colin @ Nov 9 2004, 07:19 AM)</td></tr><tr><td id='QUOTE'> <!--QuoteBegin-Sharpie@Nov 9 2004, 08:02 AM
I find it hard to believe that anything drastic to really simplify things, will ever be done.

Do you really think they would cut back IRS employees? Can't imangine that...... and put most of the accountants out of biz? My what a simplier world..... makes way too much sense to ever happen.
I think most of this was under Clinton.

"During the past decade, its force (The IRS) of auditors has shrunk nearly in half, and the number of investigators is a third less, though total tax filings rose 14%.

" Since the late 1990s, the IRS cut about a quarter of its agents, auditors and investigators "

"Due to staff cutbacks the IRS has just 78 lawyers available to audit more than 3,300 gift tax returns filed by wealthy individuals. " [/b][/quote]
The best thing about huge, bloated, wasteful bureaucracy is that it's incompetent. That's why it's so easy to get away with breaking the law.

[PeerPatrick]

I'm not sure what makes a tax structure economical; that it's efficient, streamlined...

According to rawls, "Justice As Fairness", what makes a tax structure equitable is that it gives just as much benefit to the least advantaged group as to the most advantaged group, further that any added benefit given to the most advantaged has to be proportionally delivered to the least.

Flat taxes don't meet this requirement as they negatively and regressively affect the least advantaged group because the amount paid decreases proportionately as the amount taxed increases; the poor end up paying a disproportionately larger percentage of their income to taxes.

being a hardcore, ultra-conservative, somewhere to the right of buchanan on policy and Limbaugh in hypocrisy, my first thought was, "fuck ‘em, shoulda worked harder, been smarter or at least lucky", but then inevitably, i go all st. francis and start to backslide to that whole being a benevolent caretaker of the weak and disenfranchised.

I'm not sure if there is a "right" answer; it's possible that equity and economy can't be adequately compared, the prior being a concept and the latter, a condition. :salute:

[DanB]

I don't have any economics training but I am in favor of a national sales tax. So many people aren't filing taxes and so many others are working 'illegally' that we lose quite a bit of taxes.

Most of this is probably a moot point since I doubt the govt would "close" the IRS since it's such a large employer and I'm sure the special interest lobbies that make so much off of handling tax issues (lawyers, accountants, etc.) would block just about anything that would substantially change the current situation.

[Vick]

A National Sales tax would still require bean counters and the IRS would still have to function, albeit in a different manner

Most of the posters/readers of Oprano are smarter than the average bear so we understand that the funds that go to the IRS is our money.
How many of the less than intellectual actually believe they get money back from the government in the form of a tax return (when if fact they made an interest free loan to the government)

a National sales tax could being adjustable, thereby guaranteeing a balanced budget. See how quickly that would make our government fiscally responsible

Also I have suggested grocery store food items and single clothing items under $50 not to be taxed so as to not hurt the economically disadvantaged

But if a welfare mutherfucker or drug dealer is buying a $200 pair of tennis shoes
They can pay tax like everyone else

Alex suggests we may encourage an underground economy.... put the bean counters to work as detectives



Now can you tell me why if you wasted you time and effort voting in the recent Presidential Election .........

........ I didn't get your write in vote?

[PornoDoggy]

I have always thought that a flat perentage of any and all types of income with exceptions for absolutely nobody (including corporations) and nothing would be the most fair way. I don't have a problem with a floor beneath which someone pays nothing or a cap beyond which someone maxes out.

The problem with talking about taxes is the cornucopia of entities taxing you. Federal, state, local (school boards & college districts, road districts, sewer districts, hospital districts, etc., etc., etc.).

BTW ... unless the "welfare mutherfucker or drug dealer ... buying a $200 pair of tennis shoes" lives in Alaska, Delaware, Montana, New Hampshire, or Oregon, he is already paying taxes at a minimal rate of from 2.9% in Colorado up to 7.25% in California, with (in some cases) the aforementioned local entities often tacking more onto those totals.

[Vick]

PD - good thought (especially the floor and cap) but .......

.... nothing is fair


Obviously the tax you're talking about " taxes at a minimal rate of ....." is a state sales tax
A national "federal" sales tax can be added, it's still the same amount of entities taxing


Believe on the whole we would like to see less taxes.
That's why I really love the idea of a fluctuating national sales tax to balance the budget
See how quickly the pork gets cut, see the reaction when taxes flux up