“In this world nothing can be said to be certain, except death and taxes”–B Franklin

[WhyNotWhyNot]

In recent years, federal income tax policy arguments have been a central feature of every election campaign. It has become a lightning rod in the daily rhetoric of discord of the House, the Senate, and the President. If we are not careful, the tax system will divide and destroy our union. Modern election strategies have been designed to fracture the populace into small interest segments and then to play to the favorable segments and attack the unfavorable segments. A common strategy is to “fight for the middle class” and denigrate the rich. This is the “Robin Hood” strategy that seeks to establish a “middle class voting block” motivated to vote for the candidate who will make the bad rich people pay for their mythical sins. The opposing strategy, which is equally common, is to “fight to protect us from Government take-over by taxation.” This strategy seeks to create an “establishment voting block” motivated to vote for the candidate who will protect rich people and businesses from losing their fruits of success. Tax policy is the favored tool of those who feature class warfare in their election strategies. On the one hand there are the candidates who accuse “the rich” and the “corporations” of avoiding taxes and not paying their “fair share”. They demand changes to the law that will increase taxes paid by businesses and those who have above average income. They passionately point to examples that on the surface appear to be outrageous – such and such a company made a gazillion dollars and paid no income tax last year!!!; or, so and so hedge fund manager schemed to make millions last year and paid less tax than his secretary. They seek to make us believe that these notable instances are the norm and the “middle class” is being trod upon by “the Man”. On the other hand, there are the candidates who promote lower taxes and absolutely insist on “no new taxes period”. They passionately justify their position with the rationalization that it is the “successful establishment” that makes investments in the new products and business growth that advances our standard of living, creates employment, and enlarges the income pool that is taxed. Therefore, reduction in the “upper class” and corporate spendable cash flow encumbers ability to pursue economic growth opportunities that benefit everyone. The conclusion of this argument is that taxing the establishment “excessively” hurts the middle class more. They speak with apparent logic and less emotion than the Robin Hood strategists but they intend to sow deep seated fear of an impending mythical government wealth grab. This group insists that tax revenue of any kind will not be increased no matter how dire the nation’s financial condition may become. Neither side actually wants a generally satisfying resolution because they are relying on taxation friction to divide and conquer the electorate. One side says “vote for me and I will raise taxes on the filthy rich who obtained their wealth through profits on your labor” while the other says” vote for me because I will hold off the filthy crowd that wants to take your hard gained earnings by raising your taxes”. Both sides say, “Vote for me because the other guy is out to take yours”.
Our fear should be that our national political leadership is so intent on establishing entrenched polarization regarding tax policy that they are “leading” us into becoming a divided nation that trusts nothing and no one.

 

[head of joaquin]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

"Taxes are the price we pay for a civilized society" -- Benjamin Franklin (actually Oliver Wendell Holmes, but somehow attributed to Franklin due to his common sense and contempt for mindless rabble rousing).

 

[blaxshep]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

"Taxes are the price we pay for a civilized society" -- Benjamin Franklin (actually Oliver Wendell Holmes, but somehow attributed to Franklin due to his common sense and contempt for mindless rabble rousing).

Taxes are a necessary evil not the solution to everything.

 

[Tigger]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

As much as we don't care for them taxes are as necessary part of society. I don't believe that anyone is claiming otherwise. What many of us have a significant issus with is the continued increase in taxes to pay for items that are not Constitutional. Article I, Section 8 lays out a very specific set of 18 powers vested in the US Government via Congress. It is this limited list of items that Congress has the legal authority to legislate and spend money regarding. Via the Tenth Amendment, all other powers are under the authority of The States.

Until we return to a Constitutionally limited spending model, I see no need to raise even another penny worth of tax revenue.

 

[blaxshep]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

Exactly and what we need to protect the constitution from being used for toilet paper by liberals is an amendment banning the use of clauses.

 

[CalGun]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

There are a whole bunch of a problems that neither side wants to address.

1) We have adopted wants and are not paying for them,
2) We have such an archiac tax system few think its really fair any more,
3) We are allowing tax policy, spending policy to buy voting blocks
4) We have tax rates that are beyond the academically researched level of acceptance
which creates significant avoidance.

 

[wellwisher]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

The system would be better, if each tax payer, had more say as to how their tax money is spent. I like the idea of each person filling in a budget, at tax time, where you allocate your personal tax dollars, the way you wish it to be spent. Then we add up all the revenue fior all the tax opayers, and this becomes the balanced budget, which the government needs to abide by.

They could give you a pie chart of the current budget as a template at tax time. If you pay $1000 in taxes, you spread that much money over a blank pie chart, using the template as a guide. Then the IRS adds all the charts and publishes the budget of the people. The elected officials make it happen in terms of details.

If you think the government should borrow money, you can do your part and borrow it and add it to your pie chart. But only that person is liable for it. If you don't pay taxes, you don't have any say. There is incentive to contribute at least a $1 to participate. Or if one wishes to give more, say to a social program, that is also possible with the assurance it goes where you intend it.

Nobody minds giving when you have the final say, but we all feel resistance when your contribution is being wasted.

 

[head of joaquin]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

Taxes are a necessary evil not the solution to everything.

Hey kids, look at this strawman!

 

[RabidAlpaca]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

Hey kids, look at this strawman!

I'm not sure you know what that word means.

 

[ttwtt78640]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

The fundamental problem of the FIT code is that far too little effort is made to simply raise revenue (taxing income from all sources) and far too much (social engineering) to keep from doing so. We do not need countless deductions, credits and exclusions, preferences/penaties for how one's income was later spent (or in the recent case of PPACA not spent). What possible justification can there be for taxing two citzens working side by side for the same wages at different rates/amounts? Does that not violate "equal protection under the law" as well as common sense?

 

[WhyNotWhyNot]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

It is time that we unite to take away the weapon that the political candidates are using to divide the nation into classes and pit them against each other. Let’s throw out the tax code and start over!!!! That is not as radical or difficult as it sounds. Let’s have an honest national effort to design a tax code. The one we have is collection of 100 years of special interest clause upon special interest clause that has evolved into a lawyers’ and accountants’ welfare program because no common man can understand it.
Here are some basic principles and considerations that we might use to kick-off a new tax code design……. We generally agree that the tax rules should be simple. We must recognize that there is a limit to simplicity because there are many ways to generate revenue and incur the costs required to make revenue. Each must be defined by accounting practices that are written in the tax code language. Simplicity is that taxes should be only multiplication of a rate and net income. There will be complexity in the details of defining rules for calculating net income.
The tax code should not have many deductions and credits. It is the deductions and credits that fuel the divisive politics of our day because they create the illusion of unfairness. Much of the complexity that makes the current tax code so voluminous comes from provisions created by Congress for the purpose of rewarding favored activities and discouraging out of favor activities………. I believe that there is a national consensus for the principle that the tax law should not be used by Congress to accomplish social policy. There should be policy bills for those purposes. Thus, the tax code should not have many deductions and credits. But, there is no consensus regarding each individual case when considered one at a time – each deduction and credit has its own beneficiary constituency that can’t imagine life without the deduction or credit.

 

[blaxshep]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

All we need is a constitutional amendment banning the use of clauses and the problem will be gone.

 

[WhyNotWhyNot]

Re: “In this world nothing can be said to be certain, except death and taxes”–B Frank

Social Security tax and Medicare tax are income taxes on individuals…….. Why was there a maximum amount? Doesn’t it seem odd that we exempt income from people who can best afford to pay? We should not segregate income tax into bins – it is all income tax. If we are to simplify and define new rates, the rates should be high enough to cover all federal program expenditures in a single number.