Taxation

blatantninja said:

I'm of a firm belief that we could fix a lot of our problems by eliminating credits and deductions and just going to a flat 15-20% FIT rate beginning at the poverty level.

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If Wikipedia is to be trusted you take in about 27 % of your GNP in taxes, and spend about 38 %. I have a hard time seeing a flat 20 % tax taking in 40 % of your GNP.

Übereil

You're mixing statistics, which might be leading to some confusion.

There's no direct linkage between income tax rate and GDP. Right now in the US, if you take 100% of national reported personal income and compare it to 100% of federal personal income tax, I believe the number works out to 13%. I'd need to confirm that, although it wouldn't be overly difficult to pull out of the IRS data. GDP includes corporate income, don't forget.

Spending 38% would seem to be a problem though, wouldn't it. Barack and the dems want to spend more (see $450B Stimulus v2.0 he's currently touting as a jobs bill). Go figure.

BillSeurer said:

I like Cain's idea of a relatively flat tax *but* he screws it up with the no taxes on investment income part and his not slaying some sacred cow deductions. Income is income. He could easily fix his fix by leaving that part out and he could throw a bone to progressives by making the income tax part only kick in on income above $10,000 or something.

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I'd prefer dividend income to be untaxed, but only if you fixed the corporate tax code so Exxon and company actually pay taxes. The argument against taxing dividends is that it is doubly taxed income, once at the corporate level, and once at the personal level. Corporate tax rates being 40%, that means that on average, if fully taxed at the personal level as well, for a dollar of earned profit, about 68% of that would be going to the government. That's bad.

The problem is that since the big companies, particularly those with international operations, can essentially make billions in profits, yet pay single digit, or no, income tax. Then when you give special treatment to dividends for personal income, you get a very low tax rate.

Again, this screws smaller companies (and their investors) that can't take advantage of the same tax loopholes.

Long term capital gains, IMO, should not be taxed unless they are withdrawn. I see no reason why if I buy IBM at $10, then 5 years later decide to move my money into GOOG, so I sell out at $20, that I should have to pay taxes on the $10 of profit. Treat it like a 1035 exchange in real estate.

Again, an issue where the upper class can avoid taxes. There are many ways for them to take a large stock holding (usually $1MM+) and exchange it into another security (or basket) and pay no taxes. (Exchange funds being the easiest method). The middle class gets screwed again.

The "x% of people don't pay FIT!" (often stated as "don't pay taxes!") is a sham argument because many if not most of those people end up paying a higher % of their income in **total taxes** than people on the upper end.

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While I agree that they have a tax burden, since most of those taxes they pay are at the state or local level, it really is irrelevant to the issue of our national debt and national solvency.

dteowner said:

I love this "Bush doctrine" crap. Barack hasn't raised taxes for his continuation of The Stan. Barack didn't even get congressional approval for Libya, let alone funding thru tax increases. Unless you're going to further claim that Obama = Bush, you're pretty much full of it.

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You know that is a load of bull, DTE. Obama tried raising taxes on the rich, but Republicans in Congress defeated it .. Imagine that.

Never once, not a single time, has Obama linked his tax hikes to paying for his war efforts. The point stands.

That is a DIFFERENT point, than was being discussed. No one was talking about specifically linking tax increases to war efforts. The link has ALWAYS been indirect, through the overall budget discussions. Bush purposely started wars and encouraged tax cuts, Obama CONTINUED wars started by Bush and encouraged tax hikes to with the budget. Once again Republican rhetoric is never in alignment with their actions.

Grab some coffee, Thrasher. I don't think your brain is working yet. Refer to half of the first page of this thread. Post #14, in particular, which started the current line of discussion. I think you're the one that's on different points here.

Not to ruin your day, but Dubya didn't start Libya. Hate to ruin a good baseless rant with facts, but what can ya do...

Look Thrasher, while I can agree that Obama didn't have a lot of choice in the wars, and yes his taxation scheme was shot down by a Republican Congress (though many Dems did cross the party line as well), the fact remains that he still significantly increased spending, and this deficits, as well. Even if he had got his tax package, deficits would have increased. He's not innocent by a mile.

dteowner said:

Grab some coffee, Thrasher. I don't think your brain is working yet. Refer to half of the first page of this thread. Post #14, in particular, which started the current line of discussion. I think you're the one that's on different points here.

Not to ruin your day, but Dubya didn't start Libya. Hate to ruin a good baseless rant with facts, but what can ya do…

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DTE, that is a red herring and you know it. Libya is NOTHING in comparision with Iraq and Afghanistan. Totally bogus argument DTE.

blatantninja said:

Look Thrasher, while I can agree that Obama didn't have a lot of choice in the wars, and yes his taxation scheme was shot down by a Republican Congress (though many Dems did cross the party line as well), the fact remains that he still significantly increased spending, and this deficits, as well. Even if he had got his tax package, deficits would have increased. He's not innocent by a mile.

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Time and time again we have shown that the deficit increases by Bush and his congressional losers has contributed more to the deficit than the Obama administration and congress by far. Not only that, it's the Republican failed policies of deregulation and supply side economics that has killed the economy and shrunk tax receipts to a trickle.

To blame Obama is ludicrous. He inherited this mess from the totally inept Republican leadership.

False. The national debt has increased the same amount during the Obama administration as the entire 8 years of Dubya. We've posted those numbers here several times.

Wrong again DTE. For wars that republicans started and the economy the Republicans killed. To blame that on Obama is just plain stupid.

Thrasher said:

Time and time again we have shown that the deficit increases by Bush and his congressional losers has contributed more to the deficit than the Obama administration and congress by far. Not only that, it's the Republican failed policies of deregulation and supply side economics that has killed the economy and shrunk tax receipts to a trickle.

To blame Obama is ludicrous. He inherited this mess from the totally inept Republican leadership.

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I don't remember Bush coming up with a medical plan that was going to add 10 trillion to the deficit.

Thrasher said:

Wrong again DTE. For wars that republicans started and the economy the Republicans killed. To blame that on Obama is just plain stupid.

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Bush would be better categorized as a Fascist than a Republican. Obama would be better categorized as a Socialist than a Democrat. Either way is a greater form of Authoritarianism. Bottom line, they both have increased the national debt in the U.S. because they both believe in big government, just different forms of it!

blatantninja said:

I don't remember Bush coming up with a medical plan that was going to add 10 trillion to the deficit.

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You also forget that his tax cuts were far worse. Yes we know you forget things that run counter to you ideology...

Thrasher said:

You also forget that his tax cuts were far worse. Yes we know you forget things that run counter to you ideology…

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Who's forgetting about the Bush tax cuts? Saying that Obama has not done a good job with the deficit doesn't mean that we're giving Bush a free pass.

Blaming Obama for the deficit is foolish and stupid. Period. His effects are a drop in the bucket compared to the clusterfuck Republicans call "leadership"... next....

No they aren't. The amount that is being added to the debt via the health plan alone is staggering. Especially give then a large portion of the 'cost savings' that are estimated in the plan are at best unproven and at worst pie in the sky, so the true costs is going to be even greater. It's not the biggest gorilla in the room, but its not the runt either. Discounting it, and his other spending, is just being dishonest.

Do you have numbers backing federal costs from:
- 2 wars?
- yearly loss in revenue due to Bush tax cuts?
- yearly loss in revenue due to the recession/depression?

Add that up and compare that with the yearly delta fed costs of the new health plan, and I am SURE you'll find that the health changes care is peanuts.

So I can claim that you are lying as well. Thanks for being true to your nature.

dteowner said:

Spending 38% would seem to be a problem though, wouldn't it. Barack and the dems want to spend more (see $450B Stimulus v2.0 he's currently touting as a jobs bill). Go figure.

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Swedish government spends 52 % of our GDP. Our economy grows by 3 % a year. You go figure.

Übereil