Saturday, August 25, 2012

How 'Bout This for Tax Simplification?

a) Three rates; 10-15% (I'm providing ranges here - the exact amounts to be determined through negotiations) on the first $30,000, 20-25% on the next $470,000, and 30-35% on everything over $500,000.......b) Capital gains and interest are treated as regular income but they will be indexed for inflation (capital gains are often caused by inflation and inflation is often caused by government - too much spending and printing of money).......c) The corporate income tax will be reduced to a top rate of 20% and NO loopholes will be allowed (that way a company like UPS will pay the same rate as a more politically "connected" company like GE does).......d) Everybody gets the standard deduction, an exemption for themselves and for each of their dependents, and a second exemption if you're over 65-67.......e) The only other deduction that will be allowed will be for state and local taxes (you shouldn't have to pay taxes on something that you've already paid taxes on). Everything else will be eliminated.............There. It's simple (1-2 pages, tops), progressive, and not inordinately burdensome. I personally think that it would work.

12 comments:

Jerry Critter said...

Sounds like a step in the right direction, but like they always say, the devil is in the details.

BB-Idaho said...

Loopholes? We've taken standard
deductions for years....

Will "take no prisoners" Hart said...

That's the beauty of it, Jerry. There AREN'T any details. A person makes X, a person pays Y. No Mickey-Mousing, period.......Same here, BB Idaho. As soon as my condominium was paid off.

Jerry Critter said...

Here's a couple of details.

What about these complex, overseas investment schemes, such as Romney is being accused of using, to legally avoid paying taxes. Going to get rid of all of those?

When you say no loopholes for corporations, are you talking about the wide variety of tax benefits and subsidies that businesses get?

How about states. Still going to allow them to give preferential tax treatment such as some businesses get for relocating there?

Will "take no prisoners" Hart said...

First question - yes. second question - definitely. Third question - of course, this is America.

Jerry Critter said...

What about farm subsides? Those gone along with all other subsides as well?

It is OK for state governments to offer tax exemptions/benefits to businesses, but not the federal government? Or is it just a matter that the federal government does not have the authority to prevent states from doing it?

Will "take no prisoners" Hart said...

I'm opposed to farm welfare and by preferential tax treatment I thought that you meant lower rates, not that they were actually getting transfer payments from the government. I'm definitely opposed to the latter but would be hesitant to have the federal government dictate.

dmarks said...

Seems good so far. Jerry had good questions.

Will "take no prisoners" Hart said...

I really think that there's an appetite on both sides to simplify the tax code. Maybe after the damned election.

Jerry Critter said...

They say they want to, but no one wants to remove tax breaks that favor their supporters. Given the contentious nature of congress at this time, I see very little getting done on just about everything unless one side or the other gets a bulletproof majority. And even then they have to keep all their members on the same page to accomplish their agenda.

Will "take no prisoners" Hart said...

I would really like to disagree with everything that you just wrote. Unfortunately, I can't.

Jerry Critter said...

I wish I could disagree too.