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philosophy -> taxes (1/9/2008 10:05:46 AM)

.....in a thread or two elsewhere on these fora, people in the US have spoken about proposed changes to the tax regime that move from an income based tax to a point of sale tax.
Now, i have always considered income based taxes to be the fairest way to tax anything. Despite not being a christian i remember the story from the bible regarding a rich man and a poor woman in church who, when offered the collection plate, gave respectively a bag of gold and a penny. Jesus asks who gave the most and then suggests that the poor woman did because what she gave was a higher proportion of her wealth than the rich man.
Given that the US is a christian nation, why is there a movement away from income based tax and towards a point of sale tax?



luckydog1 -> RE: taxes (1/9/2008 11:21:00 AM)

A variety of reasons Philosphy.  As a note, some of the flat tax proposals do have a needs based rebate, to give it a degree of progressivity.  Other proposals exclude basic needs( food, medicine, rent) that the poor spend most of thier money on, again introducing an element of progresivity.

Some benfits of such a system:

People in the underground economy pay thier taxes (ie drug dealers/underground workers/aliens).

In America some huge amount of hours and money (billions)is spent figuring out the taxes, withholding, deductions and loopholes.  It is so complicated that there is an entire non productive industry built around figuring it out.

Collecting income taxes requires that the Government know exactly how much you make and what you do with your money.  this requires laws and intrusion into peoples lives.  The IRS.

The intrusion and complicated nature of our tax code causes many people stress

The tax code is used for purposes of social engineering, which pisses people off to no end, on all sides of the spectrum.

The Tax Code gives a huge amount of power to the government, which has the potential to be abused.

The frequent changes in tax Law and requirments causes unstability on the economy, and makes long term planning difficult.

I am sure there are drawbacks also, but you just asked about the positives



philosophy -> RE: taxes (1/9/2008 11:44:08 AM)

...thanks for the informative reply LD.
i see how many of the points you have laid out might work, particulary the one about getting tax from the underground economy(although the one about a rebate for the poor means the government need to know who, exactly, is poor......which in turn cuts against the point about government intrusion)........but, inevitably (lol), i have another question.
Income based tax is based on a relatively simple ethical principle, ie the money you pay is based on your ability to pay it. Is there an equivilant, relatively simple, ethical principle that the point of sale tax is based on?



NeedToUseYou -> RE: taxes (1/9/2008 11:58:00 AM)

quote:

ORIGINAL: philosophy

...thanks for the informative reply LD.
i see how many of the points you have laid out might work, particulary the one about getting tax from the underground economy(although the one about a rebate for the poor means the government need to know who, exactly, is poor......which in turn cuts against the point about government intrusion)........but, inevitably (lol), i have another question.
Income based tax is based on a relatively simple ethical principle, ie the money you pay is based on your ability to pay it. Is there an equivilant, relatively simple, ethical principle that the point of sale tax is based on?


Not trying to step over luckydog by replying. But a rebate doesn't need to pry, if you give everyone an equal rebate. The rebate would probably be meaningless to the super rich, but it is equitable at least and requires zero paperwork to accomplish.

And my view is taxes should be based on the burden you place on society via your lifestyle. If you buy more stuff, that entails stressing the infrastructure more, polluting more, etc.... So, you'd be taxed based on the resources you consume as opposed to the assumption of consumption the income tax is loosely based around. A dollar unspent puts no strain on the government, a dollar spent buying a new item does, thus it's unfair to tax even if you aren't burdening anything by holding your money. An Income tax also implies the government has the right to your money before you do. At least a retail tax, let's you enter into a voluntary transaction of your own choice. Income tax is not a choice but forced by threat of violence, loss of freedom, or property. Big Difference. If you think about it an Income tax is a watered down form of servitude, because you have zero choice or alternative. Nothing you can do can change anything about the tax you are supposed to pay, even if you don't burden the infrastructure, don't pollute at all, you still pay to support it. A retail tax at least let's you have a choice.

That's just my view of  it  not trying to put words in luckydogs mouth. Only downside compared to the current system I can think of is that it would make retail prices higher, thus making over the border shopping sprees more attractive. But that could be addressed to.




ArgoGeorgia -> RE: taxes (1/9/2008 12:01:17 PM)

I would disagree that income tax is based on a simple, ethical principal.  From each according to their means, to each according to their means is just socialism.  It is income redistribution.  If I work hard all my life, pay my way through school, and become successful and make a good income, why is it ethical to take more of my money so that you can provide to those who did not work as hard?  Forced charity is not charity, it is robbery, plain and simple.  My guess is that if you let people keep 100% of their paycheck and not tax things like interest earned, inheritance, etc etc etc, you would see a dramatic rise in philanthropy here in America (already the most charitable country in terms of dollars given in the world when I last checked).

An income tax does the following:  punishes success while rewarding failure, takes money that I have earned without me ever having actually had it and giving it to someone who never earned it. 

A sales tax rewards frugality and savings.  Most sales tax plans are based on new sales only which rewards recycling and buying used rather than rampant consumerism and a throw-away society. 

As far as the rebate, this is actually pretty easy and doesn't require government intrustion.  You simply send a rebate check to everyone every month (it's easy, the government does this already).  The amount is based on a calculation about what the current subsistence level is for the number of people in the family.  So someone who is lower or middle class will receive a rebate check and it will replace all of the money they spend on the necessities of life.  The richer folks - well, that money will barelyl make a scratch in the amount of taxes that they probably spend monthly.  That caviar on silver spoons is awfully darn expensive.



NorthernGent -> RE: taxes (1/9/2008 12:20:05 PM)

quote:

ORIGINAL: ArgoGeorgia

If I work hard all my life, pay my way through school, and become successful and make a good income, why is it ethical to take more of my money so that you can provide to those who did not work as hard? 



Hard work isn't the driver; the concept of equal access to opportunity underpins taxation and redistribution of wealth.

quote:

ORIGINAL: ArgoGeorgia

Forced charity is not charity, it is robbery, plain and simple.  My guess is that if you let people keep 100% of their paycheck and not tax things like interest earned, inheritance, etc etc etc, you would see a dramatic rise in philanthropy here in America (already the most charitable country in terms of dollars given in the world when I last checked).



Per head, the US is way down the list, which means that while you may give the most in total, the average American is relatively uncharitable.

Furthemore, why would you start doling your money out as a result of a change in the administrative process? Charity is a principle: you're either charitable or you're not; administration/the practicalities is/are of secondary importance. 



luckydog1 -> RE: taxes (1/9/2008 12:21:11 PM)

Philosphy.  One possible way would be to require the people who want the rebate, to have to prove to the Government that they are poor.  It would nto require any Gov intrusion at all.  The Gov would have no need to determine exactly how much money every citizen makes.  People who want the refund would voluntarily show thier finances to the Gov. 

Or perhaps quailifying for WIC, SCHIP, Reduced School lunch programs, ect would qualify a person.  Heck just have an automatic rebate per child.

I personaly like my other idea better anyway, exemption of Basic needs(food, medicine, rent).  That frees most of the poor's consumption from tax, making it progressive. 

Income based tax is based on a relatively simple ethical principle, ie the money you pay is based on your ability to pay it. Is there an equivilant, relatively simple, ethical principle that the point of sale tax is based on?   I simply disagree with your premise here(what a surprise).  The money you pay is based on how effectivly you game the system via loopholes, shetlers, and lobbying in the current system.  I see no ethical beauty in that. 

I see more ethicall bueaty (though I think impractical, so don't actualy advocate it) in a flat tax.  ( I did misuse that term in my previous pst, and want to use it correctly now).  Where everyone pays the same rate.  For example (with some random )numbers we all work 100 hours for the gov.  If you make 5 an hour you pay 500.  IF you make 10 an hour you pay1000.  IF you make 100 an hour you pay 10,000.  Everyone has to put in the same amount of time, while those who make more pay more, seems fair and ethical to me.

I am an advocate of people using thier money with intent and thought.  Every time we spend money we vote.  Most people don't realise that.  I think we get exactly what we vote for with our money.  Its not the system, its us.  A FAIR (Point of sale) might make a few more people realise it



BOUNTYHUNTER -> RE: taxes (1/9/2008 12:36:05 PM)

If we redistribute the wealth those that had it to start with would have it all back in a short amount of time,people today don't put a value on saving..Spend today and let the government take care of us in our old age...A flat tax along with a portion going to an IRA account to each tax payer...they couldn't touch it until retirement age...of courses a provision should be add to allow the family to inherit if the bread winner should pass...
       The underground economic is killing the tax system,I know at least 3 friends that have worked under the table for 20 years or more...Each say why pay into SS it will not be there we they need it....



ArgoGeorgia -> RE: taxes (1/9/2008 12:39:10 PM)

quote:

ORIGINAL: NorthernGent
Hard work isn't the driver; the concept of equal access to opportunity underpins taxation and redistribution of wealth.


The underlying intention does not change the fact that it is taking money - by force - from someone who earned it and given it to someone who did not earn it.  Forced charity. 

quote:

ORIGINAL: NorthernGent
Per head, the US is way down the list, which means that while you may give the most in total, the average American is relatively uncharitable.

Furthemore, why would you start doling your money out as a result of a change in the administrative process? Charity is a principle: you're either charitable or you're not; administration/the practicalities is/are of secondary importance. 


First, I would ask for where you got this information.  A quick google search is showing me just the opposite.  And if Americans give the most in total, where is the money coming from? If it comes from the government, it is coming from our taxes.  If it is coming from businesses, churches, etc, those are all groups of people.

It isn't changing charitable nature according to administrative process.  Don't you think that a person who right now may want to give money but is unable to due to a very burdensome tax system might be able to if suddenly they got a 20-30% tax increase?  You can't give what you don't have. 



ArgoGeorgia -> RE: taxes (1/9/2008 12:40:28 PM)

quote:

ORIGINAL: BOUNTYHUNTER
      The underground economic is killing the tax system,I know at least 3 friends that have worked under the table for 20 years or more...Each say why pay into SS it will not be there we they need it....


No kidding.  Social Security is the biggest pyramid scheme ever perpetrated...



NorthernGent -> RE: taxes (1/9/2008 12:57:52 PM)

quote:

ORIGINAL: ArgoGeorgia

The underlying intention does not change the fact that it is taking money - by force - from someone who earned it and given it to someone who did not earn it.  Forced charity. 



Of course it's forced charity (to some) - the will of the majority; I'm not arguing to the contrary.

My point is this: the principle underlying redistribution of wealth has nothing to do with penalising hard work; it is recognition of an imbalance in access to opportunity.

Of what background are your politicians and CEOs?

quote:

ORIGINAL: ArgoGeorgia

First, I would ask for where you got this information. 



It's easy to find. We had it out on here a few months ago, and the stats do not support your point of view. Have a look at comparative figures; in fact, post some if you'd like to prove a point.

quote:

ORIGINAL: ArgoGeorgia

And if Americans give the most in total, where is the money coming from? If it comes from the government, it is coming from our taxes.  If it is coming from businesses, churches, etc, those are all groups of people.



There are 300 million of you which gives you a head start when discussing 'total'. 

quote:

ORIGINAL: ArgoGeorgia

It isn't changing charitable nature according to administrative process.  Don't you think that a person who right now may want to give money but is unable to due to a very burdensome tax system might be able to if suddenly they got a 20-30% tax increase?  You can't give what you don't have. 



Your point appears to be this: you would suddenly become charitable were it not enforced by the will of the majority? I'm not convinced. What would you sacrifice to make way for this charity?



subfever -> RE: taxes (1/9/2008 1:11:15 PM)

quote:

ORIGINAL: philosophy
Given that the US is a christian nation, why is there a movement away from income based tax and towards a point of sale tax?


There's no movement. It's all a bunch of rhetoric, jawboning, and the creation of fodder for wishful thinking... primarily to keep the peons divided and controlled (by chasing their tails) for a few more years.

If we want to see real change, we need to start at the very top and work our way down the food chain. It's as simple as that. But so few seem to understand this.



ArgoGeorgia -> RE: taxes (1/9/2008 1:34:18 PM)

quote:

ORIGINAL: NorthernGent
Of course it's forced charity (to some) - the will of the majority; I'm not arguing to the contrary.

My point is this: the principle underlying redistribution of wealth has nothing to do with penalising hard work; it is recognition of an imbalance in access to opportunity.

Of what background are your politicians and CEOs?

I'm glad you acknowledge it is forced charity.  So apparently you feel this is ok because it is the 'will' of the majority.  I feel that this is a very unethical stance.  Might does not make right. 

Many politicians and CEO's do come from a priveleged background, true. But there is opportunity for those who take advantage of it.  It might not be as easy for some, but opportunity exists.  For the rich who do not come from a weatlthy background, should they have to pay less since they had an imbalance in access to opportunity?  How can you quantify this?  You can't - you can only base it off of income.  So yes, while it may help to equalize some instances of lack of opportunity, it also does punish success.  This is simple to understand.  If you are successful, you are forced to pay more in taxes.  It cannot be any clearer.


quote:

ORIGINAL: NorthernGent
It's easy to find. We had it out on here a few months ago, and the stats do not support your point of view. Have a look at comparative figures; in fact, post some if you'd like to prove a point.



Fine - and I can find statistics showing the exact opposite.  So this becomes a moot point I guess.  Statistics can be made to support any case. I have seen some statistics you have pointed out.  For instance, some statistics may show only government donations while not showing private.  Only showing private without considering donations by governments and non-profit organizations.  In fact, due to certain regulations it isn't exactly easy to ascertain how much money is given by private donation.

quote:

ORIGINAL: NorthernGent
There are 300 million of you which gives you a head start when discussing 'total'. 


I was talking per capita, not total.  My point was that if an individual gives money to the church or through their business, that money is still coming, in the end, from an individual. 

quote:

ORIGINAL: NorthernGent
Your point appears to be this: you would suddenly become charitable were it not enforced by the will of the majority? I'm not convinced. What would you sacrifice to make way for this charity?

You are obviously completely missing my point.  My point was simply someone who is charitable in nature but lacks the funds to contribute due to a large income tax burden would most likely give more when they could afford it.

I guess my thought on this is it is MY money.  I earned it.  No one else did.  No one put me through college (just look at my student loan payments), I'm the one who works 60+ hours per week.  So, what gives YOU - or the government on your behalf - the right to take my money from me and my family and give it to someone else?  It's very easy to be charitable with someone elses money, isn't it?



philosophy -> RE: taxes (1/9/2008 1:44:59 PM)

quote:

ORIGINAL: NeedToUseYou

At least a retail tax, let's you enter into a voluntary transaction of your own choice. Income tax is not a choice but forced by threat of violence, loss of freedom, or property. Big Difference.


...i hate to cherry pick the whole post, but this quote seemed to me to be a good starting point to frame an answer.
i see your points....i really do....my only caveat to your position of retail tax is that if the staples of life are not exempt from it then it is not voluntary. Obviously, if things like food, medical and rent are exempt its a different ball game.
Also, it is clear that income tax is not voluntary (unless you engage in a serious piece of sophistry regarding choices to make more cash), however is it the only part of living within society that isn't voluntary? Surely living under the rule of law is similar? A code of behaviour enforced by threats of sanctions.



philosophy -> RE: taxes (1/9/2008 1:47:26 PM)

quote:

ORIGINAL: luckydog1

I am an advocate of people using thier money with intent and thought.  Every time we spend money we vote.  Most people don't realise that.  I think we get exactly what we vote for with our money.  Its not the system, its us.  A FAIR (Point of sale) might make a few more people realise it


...i have to say LD that, although i am still a little suspicious of a retail tax as opposed to an income tax, there is nothing in the quoted paragraph i can disagree with.



Archer -> RE: taxes (1/9/2008 2:04:39 PM)

What makes it volentary is that with the prebate you get the money to pay the taxes on an at the poverty level lifestyle.
So your net taxes if you only spend on the nessesities of life to live at the poverty level is $0.
Only if you choose to live a lifestyle that is above that level do you spend more and thus incure any net tax burden.
And the tax burden is directly tied to how far above the poverty level you wish to live. (assuming you have the means to do so). That is how they propose to reduce the recessiveness of the Fair Tax sales tax system.

All the government needs to know is How many people with social security numbers live in your family?
4, OK then the poverty level for a family of 4 is $XX,XXX.xx Tax rate is 23% so you get ($XX,XXX.xx times 0.23)/12 per month as your prebate.



NorthernGent -> RE: taxes (1/9/2008 2:25:08 PM)

quote:

ORIGINAL: ArgoGeorgia

I'm glad you acknowledge it is forced charity.  So apparently you feel this is ok because it is the 'will' of the majority. 



That's democracy. In the event you know of a better system, feel free to put your opinion forward and garner enough support for change. Plus, who will build your roads without taxation? surely you don't earn sufficient to enable you to build your own?

quote:

ORIGINAL: ArgoGeorgia

Many politicians and CEO's do come from a priveleged background, true. But there is opportunity for those who take advantage of it.  It might not be as easy for some, but opportunity exists. 



In other words, you agree there isn't equal access to opportunity. I think it's unethical to approve such a system - if you think you're good enough to compete, then why not start from a level playing field and see what's what?

quote:

ORIGINAL: NorthernGent

Fine - and I can find statistics showing the exact opposite.  So this becomes a moot point I guess.  Statistics can be made to support any case. I have seen some statistics you have pointed out.  For instance, some statistics may show only government donations while not showing private.  Only showing private without considering donations by governments and non-profit organizations.  In fact, due to certain regulations it isn't exactly easy to ascertain how much money is given by private donation.



I've seen the stats with all donations/tax taken into account, i.e. public and private. It seems like you've shifted from "most generous" to "depends on the stats".

quote:

ORIGINAL: ArgoGeorgia

I guess my thought on this is it is MY money.  I earned it.  No one else did.  No one put me through college (just look at my student loan payments), I'm the one who works 60+ hours per week.  So, what gives YOU - or the government on your behalf - the right to take my money from me and my family and give it to someone else?  It's very easy to be charitable with someone elses money, isn't it?



Not really. You're not the only person paying tax, so you're getting something back.

What gives me the right? I don't have the right. In terms of practicalities, who will build hospitals, schools, roads etc in the absence of taxation for the common good?

By the way, did you go to a private school or public school? Either way you've benefitted from someone else's money - either your parents, or tax payers funds?



ArgoGeorgia -> RE: taxes (1/9/2008 3:25:25 PM)

quote:

ORIGINAL: NorthernGent
That's democracy. In the event you know of a better system, feel free to put your opinion forward and garner enough support for change. Plus, who will build your roads without taxation? surely you don't earn sufficient to enable you to build your own?


The US is not a democracy, but rather a representative Republic bound under a set of laws.  It is a rule of law, not majority rules (which is a PC way of saying mob rule).  And there are some legitimate uses for taxation.  They are outlined in the US Constitution.  There are also other ways of doing works such as roads - usage fees, tolls, etc.  Wouldn't that be more equitable? Charge for using the roads, schools, etc rather than just making everyone pay for it, regardless of how they use it?  I'm not against all taxation.  I'm against unnecessary taxation and income taxes.


quote:

ORIGINAL: NorthernGent
In other words, you agree there isn't equal access to opportunity. I think it's unethical to approve such a system - if you think you're good enough to compete, then why not start from a level playing field and see what's what?


I said that opportunity exists for all, some more than others, true, but that is true in life.  Every opportunity I had is available to probably most.  Public school - check.  Got a job at Wendy's and paid for a car - check.  Joined the army - check.  Paid for college with a job and student loans - check.  What you are after is for the government to make sure that all things are equal, and that is not possible, probable, or even advisable.

quote:

ORIGINAL: NorthernGent
I've seen the stats with all donations/tax taken into account, i.e. public and private. It seems like you've shifted from "most generous" to "depends on the stats".

Not at all.  I find statistics that support my case, you cite statistics which support yours. I still feel that by and large the US gives more to the world than any other country.  Period.

quote:

ORIGINAL: NorthernGent
Not really. You're not the only person paying tax, so you're getting something back.

What gives me the right? I don't have the right. In terms of practicalities, who will build hospitals, schools, roads etc in the absence of taxation for the common good?

By the way, did you go to a private school or public school? Either way you've benefitted from someone else's money - either your parents, or tax payers funds?


I understand I am getting some things for my taxes.  I better, I pay a signifcant amount each year.  Again, I'm not completely against taxation as you seem to think I am saying.  Not once did I state that.  I am against the income tax and redistribution of wealth.  There are some things that, as a community, taxes should be spent on - for the common good. But, as to your examples:
Hospitals are commonly built by private corporations, churches, etc.  And they typically do much better than publicly funded.,
Schools can and should be built by either private entitities or perhaps by local communities.  Education is where I am a little torn - I recognize the good schools provide to society, but I don't feel public schools, at least as we have them here in the US, is very good.  Most schools are paid for by local property taxes anyways, so it is outside the discussion of an income tax.
Roads - there is a valid public good out of publicly accessible roads.  But there are many more ways to fund them.  Gasoline taxes, tolls, yearly miles driven charges, etc.  Shouldn't come from income tax.

I went to public school, as stated earlier.  And my parents paid hefty property and local sales taxes for it.  So yes, I did profit from someone else's money.  Touche.  But ya know, i don't think that argument gets you very far.  Because my parents put money into the system, and rightly expected something in return. 

Quite simply, you are a socialist from the tone of your posts.  You believe that the world's social ills can be solved by taxing the rich and giving to the poor.  That is a system bound to lose in the end, because in total, you are taxing (punishing) the producers and rewarding the consumers.  This is not an economically sound system and will fail.  Good luck with it.




Stephann -> RE: taxes (1/9/2008 3:45:28 PM)

quote:

ORIGINAL: NorthernGent

Of course it's forced charity (to some) - the will of the majority; I'm not arguing to the contrary.

My point is this: the principle underlying redistribution of wealth has nothing to do with penalising hard work; it is recognition of an imbalance in access to opportunity.

Of what background are your politicians and CEOs?



How do we determine genuine imbalance, vice the perception of imbalance?

The tax codes aren't written from any sort of altruistic social engineering scheme.  Tax code loopholes exist so that the very rich (the politicians and CEOs who 'donate' to their causes) can protect their 'investments' and so that special interests who are encouraged to vote for them are given a carrot; the AARP is one of the most powerful voting blocs in the US, because they consistently encourage their voters to protect the 'sanctity' of Social Security, which is predominantly funded by the middle class. 

philosophy,

A flat tax ensures that people pay according to their means as well.  The question isn't if we should pay taxes; obviously we must all pay taxes.  But our current system penalizes those who can only meagerly save, and rewards those with the means to save vast sums of money, and spend the dividends and interest with a very minor tax burden.  To make it worse, we (especially the middle class) are taxed at a staggeringly high rate at death; why should we save, when Uncle Sam gets to sit to our funeral party and eat 70% of everything our parents saved?

Flat taxes (at, say, 10%) means when Britney Spears buys a $10,000 dress, she gets to fork out a grand in taxes.  It means that when I buy a pair of jeans for $40, I get to shell out 4 dollars.  I'd say this system hits people 'according to their means' in a fair and responsible way.  Certainly, this could see a growth in the black market, but I would suggest that it is the poor more likely to abuse the black market than the rich.

Stephan



kdsub -> RE: taxes (1/9/2008 4:00:26 PM)

There is no need for a rebate or tax deduction for the poor under a sales tax. Unless I am mistaken the plan is to not tax certain items. These would include food housing and transportation.

These provisions would allow the poor to remain virtually untaxed. Those that can afford, other than life’s necessary items, will pay the bulk of taxes.

If you don’t want to pay taxes then just don’t buy other than the necessities of life… I think it would work well.
Butch



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