Can anybody explain 'fair share'?

[ttwtt78640]

I agree, but $13,000 is the poverty line.

That's quite true.

And you have to deal with the "10% of the taxpayers pay 50% of the taxes (do NOT mention that they have 80% of the income)." line as well.

That's why I favour simply using gross income without any adjustments whatsoever. That way the income tax form could read

Line 1: How much income did you have in the last year? ________________________

Line 2: Divide Line 1 by 2 ________________________

Line 3: How much money have you already remitted? ________________________

Line 4: Subtract Line 3 from Line 2 ________________________

Line 5a: If Line 4 is positive remit that amount within 14 days

Line 5b: If Line 4 is negative your refund cheque will be processed within 28 days and mailed to you at the address given on this form.

There is no reason not to have a generous, yet truly standard, deduction amount (say the federal poverty level for a 3 person household). Taxing the portion of one’s personal income required for basic survival makes no sense to me. After all, lower income folks already lost a larger percentage of their meager incomes to property, FICA, sales and excise taxation.

I agree that taxing income based on how, or upon who, that income was later spent makes no sense. There was no need to have added all of that social engineering nonsense to the federal income tax code.

 

[TU Curmudgeon]

Yep, but add a truly standard deduction of $30K and raise the tax rate to 20% - then more taxes are paid by “the rich” and less taxes are paid by “the poor” while the government gets more revenue.

Whether that proposed change is seen as being “fair” is up to you, but the idea of taxing ‘excess’ (beyond what is required to meet basic needs) income makes much more sense to me.

Is that "standard deduction" per person or per household?

If it is per household, you are going to lower the tax base considerably. If it is per person you are going to practically eliminate it (as any couple with two children wouldn't pay any taxes at all until their household income exceeded $120,000.

BTW, have you actually done the math to see what fraction of the current federal income would continue to be received by the federal government through income taxes if the flat tax was set at 20% using either of those two "standard deduction" formats? I suggest that you do so and then get back to everyone to tell us how you are going to reduce spending to account for the decrease in revenue (please specify which programs would be cut back and by how much).

 

[NatMorton]

Of course we all know the rich and corporations don't pay their ' fair share'.
But what is the exact percentage they should be paying and why is that 'fair'
?
Please ,no anecdotes about people or corp's that didn't pay this or that. What #should# they be paying and why?

In Leftspeak "fair share" always translates to the English word "more."

 

[ttwtt78640]

One way or reducing that unfairness is to combine a flat tax with a guaranteed annual income which is paid on a per capita basis.

A single taxpayer would pay __% of their income in taxes and would receive "1 x $GAI". A couple would pay ___% of their income in taxes and would receive "2 x $GAI". A couple with two children would pay ___% of their income in taxes and would receive "4 x $GAI". A couple with 15 children would pay ___% of their income in taxes and would receive "17 x $GAI".

You could, if you wanted to, put the GAI on a sliding scale so that it worked like

• 1 person household = 1.0 x $GAI
• 2 person household = 1.9 x $GAI
• 3 person household = 2.7 x $GAI
• 4 person household = 3.4 x $GAI
• 5 person household = 4.0 x $GAI
• 6 person household = 4.5 x $GAI
• 7 person household = 4.9 x $GAI
• 8 person household = 5.2 x $GAI
• 9 person household = 5.3 x $GAI
• No further increase after 5.3 x $GAI

Hmm… first you say pay a GAI on a per capita basis and then then suggest reducing it based on cohabitation (household size). There would be no need for a GAI (or prebate?) if you simply had a generous standard deduction amount.

 

[Questerr]

Of course we all know the rich and corporations don't pay their ' fair share'.
But what is the exact percentage they should be paying and why is that 'fair'
?
Please ,no anecdotes about people or corp's that didn't pay this or that. What #should# they be paying and why?

Well considering they have control over something like 90% of all of the country's wealth...

 

[TU Curmudgeon]

Here are the choices for 'fair'

Govt wants to spend 4 trillion.

Most fair - Every citizen pay an equal share, about 11k per every citizen (adults and children and retired and prisoners and people in comas)
Tolerable - Flat income tax of about 30%, bottom half of workers paying about 1-10k per year per person, top half paying about 10k-30k a year. Top 1% about 30k-3 million a year or higher.
Current - Taxes everywhere on everything, from cradle to grave, no income taxes on half the country, most taxes on the rich
Extremely unfair - 100% tax on everything, basic income for all

With of course 75% of the taxes going to the bottom 50% in the form of social spending.

You are close with that "about 11k" - actually it's $11,765.

The average household income is $68,730 and the average household size is 2.6. That makes the average per capita income $26,434.

You do realize that 30% of $26,434 is only $7,930, don't you?

Would you please explain where the other $3,835 is going to come from?

Alternatively, how do you suggest selling 44.5% as the flat tax rate (for JUST the federal budget)?

You do know that, when you add in state budget, country budget, and municipal budget on top of your federal flat tax rate, you are likely to end up with a tax rate close to the 60% level, don't you?

 

[TU Curmudgeon]

Hmm… first you say pay a GAI on a per capita basis and then then suggest reducing it based on cohabitation (household size). There would be no need for a GAI (or prebate?) if you simply had a generous standard deduction amount.

What is there about "You could, if you wanted to ..." that you don't comprehend?

 

[TU Curmudgeon]

I like your idea more than the other, but what about this? We have the technology, would we have the will?

Print the trillion dollar coin. The federal and states governments collect zero tax revenue during calendar year 2023. At the end of the year the costs of running our governments are totaled. Individual and business wealth and income are calculated. Total wealth and income for each business and individual are assigned a tax bill based on their share of the years wealth and income. Your payment is due 4.15.23

Balanced budget, no additional deficit spending, those with the greatest...pay the most, but everyone pays something.

If you "(p)rint the trillion dollar coin" the net result would likely be that the US dollar would settle out on a rough parity with the

​

which is currently trading at roughly 41,650 to the US dollar (and about 31,250 to the Canadian dollar).

That might have some "slight" adverse international financial consequences.

 

[TU Curmudgeon]

well if you want to argue the flat tax, thats fine, I have no problem with it, as long as EVERYONE has to pay the same percentage amount on EVERY dollar they are allowed the benefit of using in our country with no loopholes.

and as far as why should they be forced too... why is anyone forced to pay taxes? We all are , now aren't we?

An interesting way of looking at taxation is to NOT tax UNDISTRIBUTED corporate profits at all but to tax all distributed corporate profits in exactly the same manner that hourly wages are calculated. That would mean that the companies would either have to

1. simply sit on huge piles of money (which the shareholders wouldn't stand for and which would actually almost totally screw up the economy);
2. not pay any dividends (which the shareholders wouldn't stand for) AND spend the remainder of the money on expanding/improving corporate operations (which would expand the economy);
3. pay out some of the profits as dividends (which the shareholders would like) AND spend the remainder on expanding/improving corporate operations (which would expand the economy); or
4. use some of the money to buy more "corporate friendly" politicians and get the rules changed back to the way that produced the highest levels of untaxed income for the shareholders.

Which option do you suppose the corporations - at the direction of the shareholders - would choose?

 

[TU Curmudgeon]

A wealth tax, as long as it is a direct tax, is up to Congress. This isn't even a ballpark figure, but those earning less than $50 k a year with no real assets would get a bill of under $100 while having a year of no tax payments to get ready.

Just did a quick search, 2021 income of about $21 trillion, wealth of about $110 trillion, Fed govt spending $6.2 trillion, states and local governments about $3.4 trillion

So you are advocating obtaining around $9.6 trillion in revenue from taxpayers' incomes of around $21. You do realize that that works out to an effective tax rate of around 41.75%, don't you? If based solely on "wealth" then you are talking about a tax rate on a fixed pool of around 8.7%. That would mean that a pensioner who bought their house which is now worth $400,000 for $80,000 would have to pay around $34,800 in taxes. How many pensioners do you know with a pension income of around $2,900 per month?

 

[TU Curmudgeon]

Bloviating Biden threatened to punish oil companies with windfall tax. There is clearly no monopoly or price fixing in that highly competitive industry. BIG Oil does not come close to having a dominant position in the retail gas industry. 80% of gas is sold at convenient stores.

While that may well be true, you do realize that neither Mac's nor 7-Eleven actually own any refineries and that they actually have to buy their gas from "Big Oil" - don't you?

 

[ttwtt78640]

Is that "standard deduction" per person or per household?

Per FIT return filed - if two people have income (whether cohabitating or not) they are both expected to pay FIT (individually).

If it is per household, you are going to lower the tax base considerably. If it is per person you are going to practically eliminate it (as any couple with two children wouldn't pay any taxes at all until their household income exceeded $120,000.

Nope, the deduction is truly standard - it does not vary based on how or upon who one’s income was later spent.

BTW, have you actually done the math to see what fraction of the current federal income would continue to be received by the federal government through income taxes if the flat tax was set at 20% using either of those two "standard deduction" formats? I suggest that you do so and then get back to everyone to tell us how you are going to reduce spending to account for the decrease in revenue (please specify which programs would be cut back and by how much).

As I said before, that is impossible without knowing what gross income the current FIT is applied to. Without knowing that it is impossible to determine the current effecitve FIT rate.

I can supply examples under my two number tax code, but I can’t determine what folks with the same gross incomes would be currently required to pay - since that is based on their (highly variable) ‘adjusted gross income’ (AGI) amount.

Using a standard deduction of $30K and a 20% tax rate on any and all (annual) gross income over that amount - here are some examples:

A gross income of $30K (or less) would ay $0 in FIT for an effective rate of 0%.

A gross income of $50K would pay $4K in FIT for an effective rate of 8%.

A gross income of $100K would pay $14K in FIT for an effective rate of 14%.

A gross income of $200K would pay $34K in FIT for an effective rate of 17%.

A gross income of $400K would pay $74K in FIT for an effective rate of 18.5%.

A gross income of $800K would pay $154K in FIT for an effective rate of 19.25%.

As you can see, the effective FIT rate is still quite progressive for those up to 4X the median income and flattens out quite a bit after that.

What I can’t know is what the ‘typical’ AGI is for someone with a gross income of $400K. What I do know is that a $10K itemized deduction gets someone with income at the 25% marginal rate a $2.5K federal subsidy, but gets someone with income in the 35% rate a $3.5K federal subsidy - it makes no sense at all to give the richer person a (40%?) greater federal subsidy for the same itemized deduction amount.

 

[TU Curmudgeon]

Per FIT return filed - if two people have income (whether cohabitating or not) they are both expected to pay FIT (individually).

So a widow with six kids under the age of 12 would be entitled to only a single "standard deduction".

Would you like to rethink your position?

Nope, the deduction is truly standard - it does not vary based on how or upon who one’s income was later spent.



As I said before, that is impossible without knowing what gross income the current FIT is applied to. Without knowing that it is impossible to determine the current effecitve FIT rate.

I can supply examples under my two number tax code, but I can’t determine what folks with the same gross incomes would be currently required to pay - since that is based on their (highly variable) ‘adjusted gross income’ (AGI) amount.

Using a standard deduction of $30K and a 20% tax rate on any and all (annual) gross income over that amount - here are some examples:

A gross income of $30K (or less) would ay $0 in FIT for an effective rate of 0%.

A gross income of $50K would pay $4K in FIT for an effective rate of 8%.

A gross income of $100K would pay $14K in FIT for an effective rate of 14%.

A gross income of $200K would pay $34K in FIT for an effective rate of 17%.

A gross income of $400K would pay $74K in FIT for an effective rate of 18.5%.

A gross income of $800K would pay $154K in FIT for an effective rate of 19.25%.

As you can see, the effective FIT rate is still quite progressive for those up to 4X the median income and flattens out quite a bit after that.

And you still haven't shown how the TOTAL collected will be sufficient to meet the budgetary needs of the country - have you?

What I can’t know is what the ‘typical’ AGI is for someone with a gross income of $400K. What I do know is that a $10K itemized deduction gets someone with income at the 25% marginal rate a $2.5K federal subsidy, but gets someone with income in the 35% rate a $3.5K federal subsidy - it makes no sense at all to give the richer person a (40%?) greater federal subsidy for the same itemized deduction amount.

And why deal with any adjustments to income at all?

Why not simply have a "tax reduction" based on household size?

 

[ultmd]

So you are saying the acrood the board rate for all corporations should be that which produces 5% of GDP.? Here's the problem with that. It would be a guess since we don't know what GDP is until after the fact. Are you saying the they should be adjusted throughout the year?
You are also basically saying-no deductions. Do you mean that?

I'm saying that 3.5% to 5% should should be the target range, and that corporate tax rates should be set with that target in mind.

There is a well-documented historical legislative and policy record available for us to use as reference. We (America) literally INVENTED the concept of a majority middle class society, and we how we did it. And, conversely, we what we've done to destroy it over the last 40+years. There is no need to re-invent the wheel, here.

 

[ttwtt78640]

So a widow with six kids under the age of 12 would be entitled to only a single "standard deduction".

Would you like to rethink your position?

Nope. She may well deserve and receive other public assistance, but the income tax code is only for the purpose of funding the government.

And you still haven't shown how the TOTAL collected will be sufficient to meet the budgetary needs of the country - have you?

Nope, I don’t have the data necessary to do that. What you seem to have ignored (in prior posts) is that individual FIT revenue is not the only source of federal government revenue.

Fiscal Data Explains Federal Revenue

Check out @FiscalService Fiscal Data’s new federal revenue page! #FederalRevenue

fiscaldata.treasury.gov

U.S. personal income 2023| Statista

This statistic shows the total personal income in the United States from 1990 to 2023.

www.statista.com

It seems that total US individual annual income is about $20T and total individual annual FIT revenue is about $2.6T for an overall effective FIT rate of 13%.

And why deal with any adjustments to income at all?

To avoid subjecting subsistence level income to (additional) federal income taxation.

Why not simply have a "tax reduction" based on household size?

Because cohabitation (voluntarily sharing living expenses) does not need or deserve a federal income tax subsidy.

 

[mrjurrs]

One way or reducing that unfairness is to combine a flat tax with a guaranteed annual income which is paid on a per capita basis.

A single taxpayer would pay __% of their income in taxes and would receive "1 x $GAI". A couple would pay ___% of their income in taxes and would receive "2 x $GAI". A couple with two children would pay ___% of their income in taxes and would receive "4 x $GAI". A couple with 15 children would pay ___% of their income in taxes and would receive "17 x $GAI".

You could, if you wanted to, put the GAI on a sliding scale so that it worked like

• 1 person household = 1.0 x $GAI
• 2 person household = 1.9 x $GAI
• 3 person household = 2.7 x $GAI
• 4 person household = 3.4 x $GAI
• 5 person household = 4.0 x $GAI
• 6 person household = 4.5 x $GAI
• 7 person household = 4.9 x $GAI
• 8 person household = 5.2 x $GAI
• 9 person household = 5.3 x $GAI
• No further increase after 5.3 x $GAI

I think UBI may be something that is a part of future financial programs. In spite of all the people who think it is just a government giveaway, it works.

 

[mrjurrs]

If you "(p)rint the trillion dollar coin" the net result would likely be that the US dollar would settle out on a rough parity with the

View attachment 67422312​

which is currently trading at roughly 41,650 to the US dollar (and about 31,250 to the Canadian dollar).

That might have some "slight" adverse international financial consequences.

I don't think that is necessarily true. While printed, I don't see it being used in its entirety, I see it being used as a way to protect the dollars position as the global reserve currency. I fear the R's are going to shut down the government over paying bills they helped to generate.

 

[mrjurrs]

So you are advocating obtaining around $9.6 trillion in revenue from taxpayers' incomes of around $21. You do realize that that works out to an effective tax rate of around 41.75%, don't you? If based solely on "wealth" then you are talking about a tax rate on a fixed pool of around 8.7%. That would mean that a pensioner who bought their house which is now worth $400,000 for $80,000 would have to pay around $34,800 in taxes. How many pensioners do you know with a pension income of around $2,900 per month?

You misunderstand. The idea I proposed combines wealth and income each year. It also combines all government expenses into one figure. At the end of the year there would be a total amount of wealth and income, along with a total amount of government expenses. Each person or business would 'own' a percentage of the total wealth/income for the year. That percentage would be applied and determine that person or businesses 'share' of the tax bill.

 

[Nickyjo]

HAs nothing to do with it.
“It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own self-interest. We address ourselves not to their humanity but to their self-love, and never talk to them of our own necessities, but of their advantages”

Your points in bold show precisely why we regulate corporations, and why we should do something now. The government has done plenty for oil companies, from the right to incorporate, to the oil depletion allowance of years past, to the permanent tax cuts granted them under Trump (while ours expire), to keeping Navy fleets on either side of the Suez Canal. We are faced with the actions of a brutal invasion by Russia that affected oil prices dramatically, tho they seem to have fallen a bit. There have been times, albeit mostly during wartime, when corporations have acted for the common good. Perhaps this is one of those times.

 

[mrjurrs]

Per FIT return filed - if two people have income (whether cohabitating or not) they are both expected to pay FIT (individually).



Nope, the deduction is truly standard - it does not vary based on how or upon who one’s income was later spent.



As I said before, that is impossible without knowing what gross income the current FIT is applied to. Without knowing that it is impossible to determine the current effecitve FIT rate.

I can supply examples under my two number tax code, but I can’t determine what folks with the same gross incomes would be currently required to pay - since that is based on their (highly variable) ‘adjusted gross income’ (AGI) amount.

Using a standard deduction of $30K and a 20% tax rate on any and all (annual) gross income over that amount - here are some examples:

A gross income of $30K (or less) would ay $0 in FIT for an effective rate of 0%.

A gross income of $50K would pay $4K in FIT for an effective rate of 8%.

A gross income of $100K would pay $14K in FIT for an effective rate of 14%.

A gross income of $200K would pay $34K in FIT for an effective rate of 17%.

A gross income of $400K would pay $74K in FIT for an effective rate of 18.5%.

A gross income of $800K would pay $154K in FIT for an effective rate of 19.25%.

As you can see, the effective FIT rate is still quite progressive for those up to 4X the median income and flattens out quite a bit after that.

What I can’t know is what the ‘typical’ AGI is for someone with a gross income of $400K. What I do know is that a $10K itemized deduction gets someone with income at the 25% marginal rate a $2.5K federal subsidy, but gets someone with income in the 35% rate a $3.5K federal subsidy - it makes no sense at all to give the richer person a (40%?) greater federal subsidy for the same itemized deduction amount.

The flattening part is a problem. Imo, the higher the income, the more progressive the tax should be.

 

[KLATTU]

Well considering they have control over something like 90% of all of the country's wealth...

so your answer is 90?

 

[KLATTU]

I'm saying that 3.5% to 5% should should be the target range, and that corporate tax rates should be set with that target in mind.

There is a well-documented historical legislative and policy record available for us to use as reference. We (America) literally INVENTED the concept of a majority middle class society, and we how we did it. And, conversely, we what we've done to destroy it over the last 40+years. There is no need to re-invent the wheel, here.

i'm unclear how that translates to a corporate rate.?

 

[Questerr]

so your answer is 90?

90% of taxes yes.

 

[KLATTU]

Your points in bold show precisely why we regulate corporations, and why we should do something now. The government has done plenty for oil companies, from the right to incorporate, to the oil depletion allowance of years past, to the permanent tax cuts granted them under Trump (while ours expire), to keeping Navy fleets on either side of the Suez Canal. We are faced with the actions of a brutal invasion by Russia that affected oil prices dramatically, tho they seem to have fallen a bit. There have been times, albeit mostly during wartime, when corporations have acted for the common good. Perhaps this is one of those times.

Well -we aren't at war, so will have to agree to disagree . I think we should rely on the 'invisible hand'. The best price regulator there is! I don't want some dunce like Biden or Sanders or Warren or AOC setting prices.

 

[KLATTU]

90% of taxes yes.

who should pay 90% .Top 1% ? 5% 10%