What types of taxes do you support?

[Carjosse]

How exactly would that work.

A very confusing system of sales tax refunds.

 

[Carjosse]

No, a flat tax is not regressive. It is neither progressive or regressive. By definition, it is neither.

It punishes lower income people more than higher income people.

 

[Carjosse]

And a property tax is not a good way to do it. It undermines the ability of people to retire and I also see it as a violation of private property rights. The essence of property tax is saying that you don't own your property, the government does.

It has to be funded some way and property taxes are the best way of doing it because it is the only tax you can base on residency in a municipality and your use of services ties directly to your property.

 

[Medusa]

How exactly would that work.

does it work now ?

 

[Captain Adverse]

People who rent pay property taxes. When we owned a rental house, the property taxes were built into the rent. If the rent didn't cover taxes, mortgage and insurance it wouldn't have made sense as an investment- our profit came from the increase in property value.

So a person who could afford your rent would rent. A person who could not, didn't.

When you say "we owned a rental house" I am assuming you actually rented it out to someone else and were not "renting-to-buy?"

In any case, the owner factors in all expenses when they decide to rent an apartment or a house. The owner is charging enough to cover the expenses (hopefully, since a multiple apartment building may not always have all, or even most vacancies filled) because regardless of vacancies, the OWNER is ultimately responsible for the property taxes.

That's why even where a rental contract states the renter is "paying" property taxes, the law typically identifies this as part of the basic rent and the renter cannot deduct it from their income taxes. The owner can.

This is where the "semantics" is getting confused by people advocating that renters are paying property taxes. They really are not, the owner is simply making it clearer than other rental contracts that part of the costs of the rental will be used (and so may increase or decrease annually) to pay property taxes. The owner is actually the one paying the taxes, they are just letting renters know a reason why rents may change annually.

 

[ttwtt78640]

It punishes lower income people more than higher income people.

Not necessarily - with only a generous standard deduction (say $30K) then a flat income tax rate (say 20%) can still be somewhat progressive.

With a standard deduction of $30K then one with an income of $40K would pay a much lower effective tax rate (5%, or $2K) than one with an income of $100K (14%, or $14K) even with a flat tax rate of 20% on "excess" income.

 

[Fishking]

Well that's hard to argue in our system since property taxes have been used at State and local level since the founding of the nation:

https://en.wikipedia.org/wiki/Property_tax_in_the_United_States

Recall this was well before income tax was established as an alternate stream of government revenue.

It was also a time where we didn't have equality and private property rights had an entirely different meaning (e.g. slaves obviously didn't have them). You had a definite caste system during those days and it was composed of property owners. So just because it existed doesn't mean it didn't represent a violation. If you have to pay a tax on your own house, even if it's paid off, you don't own your house.

Now, people spend 30% and up of their income on paying a mortgage. They don't have a lot of money to put into investments to pull in a good retirement because it's all going to bills. Property taxes in the modern era are the worst taxes that exist.

 

[Captain Adverse]

I rent which, according to you, means that I pay no property taxes (directly), I pay excise taxes on various items and pay sales taxes as well. Most of my work income is paid in cash and not reported on a 1099.

Umm...don't you mean IS reported on a 1099? That's one of the purposes of the 1099.

So in Texas they have excise taxes on certain products and services in addition to sales taxes and this covers the lack of State income tax?

 

[Fishking]

It punishes lower income people more than higher income people.

No it doesn't. A flat tax is neither regressive nor progressive, by definition. It is not asking for lower income earners to pay a larger % than high income earners. If it did, it would be regressive. There are regressive taxes out there, like consumption taxes. Also, taxes aren't a punishment. They are taxes and represent a citizen contributing to the success of the nation.

You say this and then support a property tax, which is one of the most regressive taxes you could ever dream up.

 

[Fishking]

It has to be funded some way and property taxes are the best way of doing it because it is the only tax you can base on residency in a municipality and your use of services ties directly to your property.

Well, if you're fine with a horribly regressive tax method, yeah, this method works.

 

[Carjosse]

Umm...don't you mean IS reported on a 1099? That's one of the purposes of the 1099.

So in Texas they have excise taxes on certain products and services in addition to sales taxes and this covers the lack of State income tax?

That and cutting back on useless things like education.

 

[ttwtt78640]

Umm...don't you mean IS reported on a 1099? That's one of the purposes of the 1099.

So in Texas they have excise taxes on certain products and services in addition to sales taxes and this covers the lack of State income tax?

The only income I get that is reported on a 1099 is for my landlord's rental units so that she can write it off - work done on owner occupied residential property is not deductible so they don't bother to report it. Excise taxes are collected on motor fuel, tobacco and alcohol.

 

[Captain Adverse]

It was also a time where we didn't have equality and private property rights had an entirely different meaning (e.g. slaves obviously didn't have them). You had a definite caste system during those days and it was composed of property owners. So just because it existed doesn't mean it didn't represent a violation. If you have to pay a tax on your own house, even if it's paid off, you don't own your house.

Now, people spend 30% and up of their income on paying a mortgage. They don't have a lot of money to put into investments to pull in a good retirement because it's all going to bills. Property taxes in the modern era are the worst taxes that exist.

I'm not disagreeing with you. I find it disgusting that a person can lose their property simply for not paying annually increasing (usually, tho sometimes decreasing) property taxes for many services they may not ever use.

Still, someone has to pay the cost when sharing a sewage system (as opposed to a septic tank, or other self-contained system), fire services, police services, roads, etc. Sales taxes would have to be pretty steep to cover State and local requirements without some property taxation to maintain shared services.

 

[Captain Adverse]

That and cutting back on useless things like education.

That was funny. Truly it cracked me up.

 

[Carjosse]

Well, if you're fine with a horribly regressive tax method, yeah, this method works.

It is only method, how else should municipalities fund themselves?

 

[Carjosse]

I'm not disagreeing with you. I find it disgusting that a person can lose their property simply for not paying annually increasing (usually, tho sometimes decreasing) property taxes for many services they may not ever use.

Still, someone has to pay the cost when sharing a sewage system (as opposed to a septic tank, or other self-contained system), fire services, police services, roads, etc. Sales taxes would have to be pretty steep to cover State and local requirements without some property taxation to maintain shared services.

How high are property taxes in the US that people have trouble affording them?

 

[Captain Adverse]

How high are property taxes in the US that people have trouble affording them?

It literally depends on where in the country you live. Highly built up places like major cities can have outrageous property taxes, but so can rural areas where either high income earners dwell who demand a lot of services, or there are too few residents (like your town) which pushes up the individual share of costs of local services if they try to fund them themselves.

 

[Carjosse]

It literally depends on where in the country you live. Highly built up places like major cities can have outrageous property taxes, but so can rural areas where either high income earners dwell who demand a lot of services, or there are too few residents (like your town) which pushes up the individual share of costs of local services if they try to fund them themselves.

Here property taxes in cities are usually <1% and in my small town I think it was 2.5%. Of course it changes depending on the type of property but that is what it is for single-occupancy residential.

 

[Fishking]

I'm not disagreeing with you. I find it disgusting that a person can lose their property simply for not paying annually increasing (usually, tho sometimes decreasing) property taxes for many services they may not ever use.

Still, someone has to pay the cost when sharing a sewage system (as opposed to a septic tank, or other self-contained system), fire services, police services, roads, etc. Sales taxes would have to be pretty steep to cover State and local requirements without some property taxation to maintain shared services.

I don't see why it can't be received via the flat income tax, on all income.

 

[Fishking]

It is only method, how else should municipalities fund themselves?

Why does it have to be different than anyone else? Flat income tax on all income. That would be less regressive than property tax, which would crush mostly the lower income elderly. A house is one of the few investments available for the lower income.

 

[Captain Adverse]

I don't see why it can't be received via the flat income tax, on all income.

Well at some point that income for the long-term homeowner becomes Social Security and whatever (if any) other pension they might have, plus savings. They still might have a decade or more before the house is finally paid for, especially if some ass talked them into a reverse mortgage. 10% could be a major cut in their retirement standard of living.

 

[Carjosse]

Why does it have to be different than anyone else? Flat income tax on all income. That would be less regressive than property tax, which would crush mostly the lower income elderly. A house is one of the few investments available for the lower income.

Then communities with lower incomes or a large retired population would be incredibly cash-strapped because they would lack a large enough tax base. Not to mention the difficulties of implementing that tax, and it would also result in an exodus of those who can pay.

 

[Fishking]

Then communities with lower incomes or a large retired population would be incredibly cash-strapped because they would lack a large enough tax base. Not to mention the difficulties of implementing that tax, and it would also result in an exodus of those who can pay.

Lower income areas will be cash-strapped regardless of whether you use property taxes or not. Either you have a strong enough base that has the ability to pay or you do not. And where would the exodus go to if everywhere was a flat tax?

 

[Carjosse]

Lower income areas will be cash-strapped regardless of whether you use property taxes or not. Either you have a strong enough base that has the ability to pay or you do not. And where would the exodus go to if everywhere was a flat tax?

Suburbs outside of the urban amalgamation, other cites without the stupid income tax, therefore making the problem even worse.

 

[TurtleDude]

I support a tax that requires everyone to pay the same rate. Why-so politicians cannot buy the votes of the many by merely promising them that the politicians will give them more and more and only a minority will face higher taxes to pay for the pandering