what is a "fair" tax

[trapperjohn]

It seems there is a lot of talk these days about taxes, and prticularly "fair" taxes. Some advocate a flat percentage rate as being "fair", Others advocate a consumption tax as being "fair". Still others think a progressive tax such as we have is "fair". But what is Fair. If i go to walmart and am in line in front of a person who makes half as much as I do, should I pay twice as much for a Gallon of milk than the person behind me? No one would call that fair. that would be an example of a flat tax, you make twice as much you pay twice as much. Most people would agree that the fair thing in that case would be that each person pays the same amount for the same service. Whether rich or poor you still pay the same amount, in this case for the gallon of milk. If we consider the government as a service provider. i.e, providing defense, then wouldnt the Fair thing be that each person pays the same amount? Why would a flat amount payed be each person not be fair?

 

[atek3]

Goes into the regressive vs. progressive taxation.
Regressive taxes are take up a greater share of the income of the poor and the rich.
Pretend instead of our gross tax burden of 30,000 per capita spread throughout a multitude of taxes it was a once per annum head tax. That would mean that anyone making less than 30k would owe more than they made. Any anyone making more than 200k wouldn´t care much about the tax. A head tax on the order of 1k though I wouldn´t have a problem with. It would require dramatic changes in society though.

atek3

 

[7.62FullMetalJacket]

A fair tax would need to incorporate changes in the sales tax mentionjed by atek3. Consumption taxes are regressive for basic necessities (food, clothing, shelter) because the poor and the rich really need about the same basic necessities.

Flat tax is the way to go because you are paying a flat percentage of your income regardless. So you make 20,000 you pay 2,000 (@10%) and you make 2M, you pay $200,000. Seems fair to me.

The economy would be in serious trouble though until it corrected. All of those "itemized" deductions would go away and the social engineers would no longer be needed. For example, many people buy homes because the mortgage interest is a direct write-off. Uh-Oh. There may no longer be "that" advantage. Now you buy just to buy and own

 

[rich2u]

Actually most advocates of the flat tax single out the home morgage interest as the one write off they would keep. Personally I think you should only be able to write off your primary residence. So the richest of us can't write off 6 different mansions...Like John F Kerry

 

[Justin]

Use of the word 'fair,' much like use of the phrase 'common sense' often denotes that what is to follow has little to no resemblance to either fairness or common sense.

 

[CannibalCrowley]

IMHO the only fair taxes would be either a flat tax or a national sales tax. Either way, the amount one pays would be proportionate to the amount one makes. But the flat tax would be much easier to implement, and probably more easily accepted.

I look forward to a day when the tax laws can be written on a single piece of paper instead of the large volumes that exist today.

 

[pax]

I think Walter William's definition is best.

pax

What's just has been debated for centuries but let me offer you my definition of social justice: I keep what I earn and you keep what you earn. Do you disagree? Well then tell me how much of what I earn belongs to you -- and why? – Walter Williams

 

[HankB]

"Fair Tax" is a contradiction in terms.

If the Federal government stuck to its basic functions - as enumerated in the Constitution - we probably wouldn't need the income tax at all; excise taxes, license fees, tariffs, etc. would provide all the funding needed.

 

[braindead0]

If the Federal government stuck to its basic functions - as enumerated in the Constitution - we probably wouldn't need the income tax at all; excise taxes, license fees, tariffs, etc. would provide all the funding needed.

Yup..

Or if the IRS administered the Income Tax according to law.

 

[.45&TKD]

Actually most advocates of the flat tax single out the home morgage interest as the one write off they would keep. Personally I think you should only be able to write off your primary residence. So the richest of us can't write off 6 different mansions...Like John F Kerry

Actually, you can only write off interest on primary and secondary residences and even these and rental houses have limits on what you can write off.

 

[nero45acp]

Personally I'd prefer a 10% national sales tax. With 5% going to the federal government, and 5% going to the state and local governments. Exempted from such a tax would be food and medicine. No other taxes except for low license fees and tariffs. If you can't fund a government on 10% of the strongest economy man's ever known then that government needs to reign in it's spending!!




nero

 

[Highland Ranger]

Consumption taxes are regressive for basic necessities (food, clothing, shelter) because the poor and the rich really need about the same basic necessities.

What means same?

Food - maybe, unless the rich guys throws a lot of parties in which case no

Shelter - hmmmmm . . . . there are some 10,000 square foot houses near me. I'm guessing they are not the same as a section 8 apartment in the Bronx.

Clothing - mink coats? designer handbags? You must not have any daughters!

Flat income tax, say 15%. That's it. Do away with all other taxes on everything.

 

[trapperjohn]

it seems most people woudl vote for a flat tax as being fair. Why would that be fair? why should someone pay more money to the government just because they work hard and make more? Wouldnt a really fair system be that everyone pays the same amount for the same services? I work one full time job, and one part time job. I make enough that I dotn get certain services that some people that make less than me get. since I am recieving fewer benifits from the government shouldnt I pay less? I would like someone to explain why it is "fair" that a high income person gives more dollars to the government than a low income person.

 

[labgrade]

A tax for what?

I have received no fire protection (I haven't burnt down my house & those that do should pay for their own stupidity), I receive no police protection (other than them attempting to kill me for checking on a neighbor), I pay my way on the roads by buying gasoline (taxes heavily included + that of when I buy new tires).

Laws covering everything that could already be illegal are already covereed - why do we even need a legislature, or pay for their salary?

I'm in a nit-mood & see no reason for any tax whatsoever.

Somebody wants "insurance" against a future disaster? then buy insurance & leave me the hell alone. My money is not yours to allocate as you see fit for programs you desire.

I could buy into taxation for national defence, along constitutional guidelines, but that's it. But, we aren't protecting our borders anyway, so why the fee?

Taxation is merely The Thug, taking your money at the impplied threat of The Gun - & subsidized by your taxes in the first place.

 

[mercedesrules]

For me, no such thing. A fair fight is when two people agree to fight. I don't agree to be taxed.

MR

 

[Mute]

A "fair" tax? Only way I can think of it being "fair" is to have all politicians cover 90% of the taxes they vote into law with their own personal assets (i.e. they can't use the salary they are being paid as a public servants).

 

[murrie]

A "Consumption Tax", or "Retail Sales Tax", with a monthly or quarterly "cost of living" refund would IMHO be the 'most fair'. No tax period on Corporations and Business transactions. Extremely light taxing (imho none) on import/export goods. I believe somewhere close to a 20% tax would generate enough income to allow the government to function and have plenty of cash left over.

No taxes on the basic necessities of life, no or very little tax if your just getting by, but as you buy luxury items, CDs, DVDS, CD/DVD players, cars, whatever your going to pay an extra 20% to the government.

Suddenly everything cost less, since your not paying the Merchants tax, the Delivery companies tax, the manufactures tax.

Additionally EVERYONE pays taxes, there are no "Corporate loopholes" or tax shelters, or political ways out, you buy something you pay taxes; everything over a certain determined "cost of living" expense is taxed.
Think about all the drug dealers, pimps, hoes, and other low life drains on society that have never and will never pay taxes suddenly are dropping 20% (instead of their current 0%) into the system.


Find more info at http:\\fairtax.org
- i dont agree 100% with their plan but its close to what I would like to see in effect. You know exactly how much tax your paying; can control exactly when you pay those taxes. Now thats Tax Freedom, and what I'd consider fair.

 

[7.62FullMetalJacket]

Highland Ranger

I was pointing out the "possible" inequities in a consumption tax. Consumption taxes are presumed to be regressive because rich and poor could buy the "same exact" materials to survive and the poor would be taxed at a greater percentage. That said,

why should someone pay more money to the government just because they work hard and make more?

has merit

So, a flat tax as being considered would be a flat percentage. A flat tax as envisioned here MAY now be a flat lump sum per person rather than a percentage.

Take the federal budget, divide by the population, send the bill. Talk about howling.

 

[Standing Wolf]

If we're all supposedly equal under the law, why do no two of us pay the same taxes?

 

[R.H. Lee]

In order to determine what might be a "fair tax" one would first have to define the role of government in our society. If you confine that role to strict constitutional limits, .gov would only provide for a national defense, probably have some role in interstate commerce, perhaps adjudicate disputes between states, and what else?

If on the other hand you want the fed gov to continue its "nanny" role and involve itself in the minutia of our lives, then any taxation scheme would be onerous and burdensome on all its citizens.

 

[murrie]

I disagree that a Flat Tax is a fair one, based simply on the fact that it is taken from your income, this means that pretty much everyone who currently pays no taxes because they are criminals, using loop holes, so rich they dont have to have an income, or whatever would still pay no taxes.

A consumption tax fixes this, criminals who buy anything would pay taxes. In fact this is a big plus because a good number of these criminals would most likely pay MORE, percentage wise, than the rest of us because they wouldn't be in the system thus they would be unable to get the cost of living refunds. Criminals for the most part would not only pay taxes on Luxury items, but also on the basic items... I would LOVE to see the heaviest tax burden be placed squarely on the shoulders of criminals.

and no I have no delusions that this would force ever criminal to pay taxes, but I do believe a good number more of them would pay than currently do.

 

[7.62FullMetalJacket]

Well, one advantage to a heavy consumption tax would be the black market, bartering, and other means of trading other than using cash. Taxes would dry up significantly.

 

[R.H. Lee]

Well, one advantage to a heavy consumption tax would be the black market, bartering, and other means of trading other than using cash. Taxes would dry up significantly

True. How about some kind of "imputed" consumption tax based on a percentage of income, with tax credits against it supported by purchase receipts? In other words, a consumer based tax computed on income?

 

[murrie]

If we change tax structures the new one cannot be based on income, NO TAX SHOULD BE BASED ON INCOME!!! <- income taxes are evil, they allow the richest and the most unsavory (not the same) to get away with paying nothing into the system. It puts the burden square on the shoulders of honest hardworking middle class folks (i would consider someone making 200k a year by putting in 70 hours a week in this group).


criminals would still be criminals, and yes an increase in the black market probably would be a by product of a consumption tax, but I still think that a reasonable consumption tax would generate as much, if not more income for the government:

A. overall tax levels would be much lower than they currently are, people will at the end of the day have more of their own money - more money to buy things,

B. the VAST majority of these people who now have more money are good law abiding folks who wouldn't know how to find the black market and even if they did probably wouldn't use it.

C. Having no taxes on any type of business would be a HUGE incentive for businesses to grow, and for new businesses to move in. thus more jobs, even more money in peoples hands.

D. All those folks who get out of paying taxes now simply because they have no income (non-criminal types, the stupid rich that have no need for an income types) now pay taxes on their yachts, fast cars, fancy dinners, expensive pants, and so on.

E. All those who get out of paying taxes becuase they are criminals and are therefore not in the system would at the very least pay some taxes, even if they do set up and use a Black Market there is almost no way they could buy everything they need and want from said black market. They may not pay as much as they would without the black market, but most likely more than they do currently.


Yes there would have to be regulation and control, and decisions would have to be made; such as, what happens if someone buys something in Canada?;
and yes there will ALWAYS be people trying to cheat the system but IMHO the Consumption Tax is the fairest way for the Government to collect the money it needs to operate.

 

[flatrock]

I've been arguing that the definitions of regressive and progressive taxes are scewed since I first took economics in junior high school.

The fight for fair taxation was lost when everyone paying their fair share was defined as regressive, and a few people paying the vast majority of the tax burden was defined as progressive.

I'm a bit bitter about paying enough taxes to support a family of four while trying to pay off the debt I ran up while getting the education that allows me to make a good income.

Of course that's considered progress, and we shouldn't regress to the state where people are asked to work hard to get ahead in life.