How would you build the perfect tax system and how much would the state do?

the US system has some flaws, but it's by far the best system thus far imo

we could go back to living like the Indians and have no taxes though...

me personally, I would support a flat tax... basically same as now except all income over the poverty line treated as income

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Do y'all really think taxes are what's pays for all this. Just the military base around the round in sure cost more than we take in on taxes.

 

I didn't mean that most people don't have an electronic signature. I meant that most people would not understand that type of a tax and it's "fairness" could not be judged by most people. A federal sales tax can be collected by the states with their existing infrastructure and turned in by the states. A couple of states don't have a sales tax, but it's not a huge hurdle.

I hadn't considered stocks, bonds, real estate, vehicles and other things of that nature. I'd suggest a smaller tax in the 1-5% area for investment or larger items.

 

Well here's the thing, if every electronic transaction is taxed regardless of what it is for, a tax of 0.002% would be enough to eliminate all other taxes at every level of government, federal, state and local and pay off all their debts. That means that if you paid a tax of 20 cents on every $100 that left your hands you would pay no other taxes, none, ever again. No IRS, no tax forms, no sales tax, no property tax, no DMV fees, no highway tolls, no payment by you to any government entity ever. For businesses it would be the same, no taxes and no fees and a vast reduction in government interference with operating your business.

If you are an investor, no more capital gains tax. If you are a small investor saving for your retirement and make $100,000 in trades over the year you would pay $200 in transaction taxes win or lose. The 15% capital gains tax on a $10,000 gain on those trades would result in $1,500 in taxes.

The flow of money in the economy every day is so enormous that most people cannot comprehend it. They can only think of GDP, which is only what people have left over from all that money changing hands. When they think of transactions they think retail sales have to be far more than all other transactions, which is why they think sales tax.
Consider this:
The average of daily retail transactions in the US is less than $1Billion
The average of daily transactions on the New York Stock exchange is $20-30Billion
The average of daily transactions on all the stock bond and commodity markets in the US is $100-200Billion
The average daily volume of transactions on the global currency exchanges is more than $5Trillion

Every one of those transactions triggers 2-10 more transactions, all recorded electronically.

A tax that dipped into that vast river of money sloshing around the economy every day could be very tiny and be more than enough to fund the government, 0.002% would be more than enough.
You still think a 10% retail sales tax is a good idea?

 

I'm not downing your idea. It may be brilliant. I would want to know what effect it would have on the price of other things. Will the cost of the transaction tax be passed on and to whom? How will they react?

 

Step one: I don't have to pay anymore taxes of any kind ever again.

Step two: Do whatever the hell you want, I am happy after step one.

 

I'd built it on a one-collector system, I don't care who, city, country, state or federal. Let the collector distribute it. That way we could see what we are paying in total, at all times.

I'd build it on a progressive basis based on the ancient theory that a dollar is worth more to a poor man that to a rich man.

I'd tax internet purchases, not so much to collect more money but to aid local retailers.

I'd tax wealth as well as income.

I'd tax all dollars as if they were actually dollars. That is, who gives a sh*t if dollars are capital gains.

 

Taxes serve the purpose of forcing us to use the dollar because that is the only way we can pay our taxes. Taxes also give the government a means of speeding up the economy and slowing it down. They serve the function of redistribution and either discouragement or encouragement of behavior. The government could finance everything without taxes, they own the money supply. In reality, Americans get a fantastic return on their taxes.

 

You cannot print infinite quantities of dollars without downside. If US debt is held by others buying US bonds, there is a limit how many bonds can be sold, and there is an ever increasing service on that debt...right now about $450 billion per year. Currently Americans are paying $3.3 trillion in taxes and getting a $4 trillion government...great deal!

 

Prices would go down as tax compliance expenses, which are not trivial, are eliminated for every manufacturer, retailer, service provider and everyone else doing business in the US. People and businesses would have more money to spend and save and invest, which would boost the economy and the markets. The cost of complying with the tax code has been estimated at $50-60Billion a year for businesses. That does not include actual tax payments, just the expense of figuring them out. That expense would be entirely removed, freeing up the money for more productive deployment.

Some financial traders could lose, especially the high frequency traders, but that would not be a bad thing since high speed trading destabilizes the markets and interferes with other traders.
The biggest losers would be tax lawyers, tax accountants and those who currently pay zero taxes because of the convoluted tax code. The Wall Street Journal actually had an editorial about this transaction tax a few years ago. In it they complained that a tax of $20,000 on a $Billion bank transfer was so onerous that the entire world financial system would be driven into immediate collapse. Completely ludicrous as that is, it was the best they could come up with.

This is not my idea, it was first proposed a number of years ago by some economists from Columbia University and elsewhere who had gained access to the actual real world data of a few of the largest electronic transaction processors.

 

The limit is set by the interest rate offered. US Bonds are sold out every auction. The demand for them is endless. Is there a potential limit to how much money can be created? Yes but it is tied to a factor that is not related to money supply, it is a factor of effective demand, income distribution, availability of goods and services and so on. The supply of money is like watering a garden that keeps growing outwards or shrinks. If you want it to grow, you have to water it. If you want it to shrink, cut back on the water.

 

The limit will also be created by the interest rate demanded from buyers. More US debt, continued deficit spending, reduced value of dollar, and whatever other crap the US is doing might create more risk in the eyes of the investors...more risk equals higher interest rates and/or less buying.

If you double the debt by selling more bonds, then you double the interest payment to $900 billion...how much more debt service can the US budget handle considering today we are not even paying our way?

I've never understood, assuming we're not in a national emergency, why we don't shoot for fiscal responsibility...why we have no public awareness of the mounting debt and debt service...why we have continued deficit spending...

 

We just need to move back to the old tax rates. But 70 percent for all income earners above a couple million bucks. Take away their loopholes. Tax capital gains at the income tax rate, for it is the only way some of the top dogs earn their income.

Get rid of corporate taxes. They just pass on those taxes to the consumer.

Tax inheritance at 70 percent above a certain amount, which is designed to keep a man from passing on his empire, so that each generation has to earn his own wealth, and not have it given to them. This gets rid of old wealth which corrupts the gov't.

For as long as you allow a small group of people to have much more than the average guy, they will work hard to have more than the average guy, for the identity and self images of these people is based upon money.

 

Don't understand why you and others want to punish those who succeed? What is the purpose of extracting more taxation from the group which already is paying 85% of the federal income taxes? You want them to pay 100% of the taxes so others don't need to pay anything...just take but no give? Why don't you talk about 100 million Americans who pay no income taxes yet make more and more demands on government?

Whatever wealth a person accumulates belongs to them and as such should be passed onto heirs without further and double taxation.

Please explain how the wealth of Bill Gates effects how much all other workers can earn, invest and save???

 

The purpose of the income tax is to extract revenue from those who can afford to pay it. It makes no sense to tax the incomes people who are unable to afford their basic living expenses.
Wealth is not accumulated in a vacuum, in fact, the more business one undertakes the greater the use of government resources occurs. Someone operating a $Multimillion business does so with a far greater use of government infrastructure, resources and services than any of the people who work for them do, certainly far more than any of the 100 million Americans who do not pay income tax.

I am continually amused and appalled by the blind arrogance of the wealthy, who believe that their fortune and success had absolutely nothing to do with the government and that any taxes on them are some sort of completely unwarranted punishment for their success. Their blithe disregard of the fact that it was the government that generated the economic and social infrastructure which allowed them to gain their fortune is somewhat psychopathic.

By that logic anything paid for once should never be taxed again if its ownership is transferred to some family member, no matter how distant, which is quite discriminatory against people who do not gain things from family connections.

If Bill has all the money no one else has enough to save and invest, which is what is going on at a very large scale in the economy right now. The wealthy have accumulated so much of the available wealth that they have created a circumstance where large portions of the population are unable to earn enough to meet their basic survival needs, let alone save or invest.
100 million pay no income tax because 10 million have far more income than they can possibly ever need but are unwilling to share enough of it with those 100 million so they could make enough to pay some income tax. The 100 million are victims of circumstance more than anything else. The 10 million have choices and their choices created the circumstances that the 100 million find themselves in.
Do not complain about the circumstances created by choice.

 

I'm game I would have the Federal government decide how much it needs to operate then have states based on the citizen and legal resident population pay their share, they would have to collect the money and I would set this at the cost to operate plus an amount to pay down the national debt.

States could come up with the money anyway they wish but if its not paid they get no services to that State from the Federal government save for disaster relief and Federally committed services.

The IRS would exist only to come up with the amount and then send the bill to each state and to make sure there is no interference the agency would be semi-independent assured operating expenses and be like the Federal Reserve.

 

The reason the top dogs are paying much of the taxes is simple. They have taken 60 percent of the middle class income, and you have to tax income where it is being made. So they start paying more of the income tax.

We need really high taxes on the rich, above say a million bucks, in order to address the damage to this nation of average people, that this greed has created. As well as the effects of automation which removes income for workers being replaced, displaced.

No man becomes a billionaire by being fair with those that made his wealth for him, the ones doing the actual work. Rich people are created by not being fair, by not paying his workers what they were actually worth. If Gates were simply a millionaire, that means that billions that was made by his workers would end up in their pockets, not his. How would that affect American society? Would it implode simply because he paid the people who made him a billionaire more? Why did he not settle with being just a millionaire? Well, obviously he overrates himself, his own value, and underrates the value of those that created his billions.

 

The purpose of income tax is to fund the USA. Who benefits from everything in the USA...ALL 315 million Americans! Who should pay for the government which they demand...ALL 315 million Americans. Go back to the 70's and Americans who earned $0 to $4000 were paying 14% income tax. What's the ONLY difference between then and now...politics and social welfare!!!

And without those businesses who you claim consume more than anyone, there would be zero jobs!

Jealousy is not a reason to tax people? Who cares if someone dies and passes on $50 million to their kids? As long as taxes were paid when the $50 million was earned then why care...except for jealousy?

Your comments above are absurd? How much Bill Gates and all other wealthy people have gained in wealth has absolutely nothing to do with Joe-Blow and how much they can acquire...this is petty jealousy and nonsense. FACT: If a person desires more, then ONLY than person needs to take steps to earn more...

 

Everything above is a political diatribe with zero substance? How about ALL AMericans paying for the government which ALL Americans demand?

You cannot identify a single thing, nothing, nada, in which Bill Gates is doing something which prevents YOU to earn your potential!

You're just jealous of wealthy people and you and others really need to focus on yourselves...

 

Wealth should never be passed on in any form of democratic gov't. For wealth, carried over generations, passed on will inevitably corrupt politicians. Passing on wealth creates a class of elites that don't have to be successful, don't have to work, for their ancestor did that for them. This is not a value system any intelligent society adopt.

Has nothing to do with jealousness, it is just pragmatic and practical for we should have a system that will not tend to corrupt a democracy, or in our case a republic. It has corrupted it, and given us an oligarchy.

Each person should work for his living. We should not have a class of elites who become entitled, which passed on wealth creates. The money any man has should lose its value with the death of his body. It was his, and should not be transferable. He can use his wealth to educate his kids so that they can earn their own keep, just as everyone else does in a society.

 

This is easy. We used to not have an income tax. You place a higher purchasing tax on everything, more luxurious, higher tax. No deductions (except for charities), no income tax, just purchasing taxes. You'd be surprised at how much more money you would have to spend, thus increasing the amount of money gained from purchasing taxes. More income for job makers, more jobs for people. We've only made it hard because of politicians. This is really simple.

 

It is ridiculous for others to determine what someone does with THEIR wealth at the time of their death. People really need to focus on themselves and stop the jealousy of others. I could care less if my neighbor gives his $100 million to his kids, if his kids work or not, if his kids are lazy or not...I don't care, it does not effect me, and it does not effect anyone else. The ONLY possible way I could care is if I was jealous.

Money does not corrupt government?? People corrupt government!

I have no further comments to this jealous diatribe...

 

Passing on wealth creates powers that are detrimental to a gov't by and for the people. And the idea that each of us are responsible and are to take care of ourselves by our work, is a great idea for any society to value. When you allow wealth to be passed on, taking away the need for a group of people to work, to contribute, to support themselves, you create a culture that doesn't value work, but living off of the work of someone else. Why should a man's kids be entitled to his wealth, once he dies? They didn't work for it. Is this the sort of thing we want society to value, wealth never worked for, as we demand others in society to make their own wealth? This creates problems, problems in value systems that affect behavior.


You can call it a jealous diatribe, and be wrong, as much as you want. If you like being wrong, go ahead. I am talking of the pragmatism of a particular value system, that is superior to a value system that allows wealth to be passed on to people who didn't do a thing to create it. No one gets a free ride, in an equitable, fair, moral society.

If a man could not pass on his wealth to those that didn't do a thing to earn it, perhaps he would not have hoarded it, and payed in out to those people who created his wealth in the first place? At least unlike his kids, these people worked for it, using their life, their time to do it. An intelligent society would not allow the transfer of money to people who did not earn it within a family. We don't need a class of people who inherited their wealth, never worked for it, but then because of that wealth, can buy policies that only benefit themselves, as the people working get shafted. I know this is what the conservatives want, but they don't want people to have a level playing field. That demand priviledge for a certain group.

 

Go back to the 70s and someone could actually live on $4,000 a year. The minimum wage was $1.35. The average new car cost around $4,000 and the average new house cost around $16,000. A car cost one year's income and a house 4. These days the average new car costs $20,000 and the average new house $200,000 and you are suggesting that someone making $4,000 can still afford to pay that 14% income tax?

If they paid their share of taxes there would be even more jobs because the government could afford to build and maintain and improve the infrastructure they are so dependent on. It would result in a reduction in their expenses allowing them to invest more in their business instead of absorbing the increasingly expensive costs of goods and people due to deficient US infrastructure.

It amazes me how shortsighted the business community is. They have engaged in 40 years of blind warfare against all taxes and now they complain about the deteriorating transportation network and lack of education in the employment pool. That they had everything to do with that seems to be completely beyond them.

Jealousy? I am not jealous of the wealthy and do not really care to be among them with their narcissism and self importance even though I am almost every day.
What I would like is for them to put their narcissism and self delusion aside for a minute and realize that there might be some greater and more important things than their own selfish desire.

It has everything to do with the decline of Joe-Blows prospects in this world.
Projecting criticism, no matter how slight or indirect, as jealous nonsense is exactly how a narcissist would deal with criticism. Whenever a narcissist raves about jealousy it usually elicits reasonable people to express pity at such a wholesale disconnection from reality. A narcissistic defence of wealth will not likely recruit many who are not wealthy to agree that they should not pay higher taxes. It is a spectacle like watching the wealthy diva who expects to not pay a cover charge at a nightclub throw a fit when they told to get in line and pay the cover.

 

eliminate taxes all together. let those who USE services pay for them. Cut the military, spy and govt by at least 90% and the voluntary payments and some LOTTERIES can pay for the (legitamate) govt expense. US should be broken up into at least 8 (more-homogenous/agreeable) nations. With nearly everyone off with their own kind, there'd be a lot less bs and waste and a lot more productivity.