How do you raise taxes

[Pete]

How do you raise taxes without raising taxes?

Rush seems to think the R's will allow the President to raise (they will raise) the tax rate on the "evil rich" - just who qualifies as "evil rich" is TBD. Nobody cares what tax rate the "evil rich" pay - but most everybody agrees it ain't enough.

But that ain't near enough to raise the large chunks of money required.

So looks to be tinkering with deductions and massaging the AMT to trap more people.

So the average Joe trapped by the AMT ain't going to find out until April 2014.

So with the infusion of extra cash through early 2014 things will look real rosey for the Feds and politicians can spend more - but we're in the hole again for later in 2014.

The Government "I'll tax you today for cuts I'll make next month."

[Dad]

I highly recommend Bruce Bartlett's "The Benefit and the Burden" for undertanding the tax process. I am going to have to read it twice to grasp everything. The author was Jack Kemp's advisor on tax policy and an economic advisor to Reagan. He has what seems to me as sensible ideas. He is also one of the former Reagan advisors who maintain Reagan could not gain the GOP nomination today. As he has stated in interviews, everyone remembers Reagan cut taxes. every one also forgets he raised them 5 times. Unlike todays GOP, Reagan and George H W Bush hated deficits. I am sure most every one remembers David Stockman's famous comment concerning supply side and trickle down--and Reagan refused to fire him for it. The one line in the book that will always stick in my mind is, "when did it become cool to not pay your fair share of taxes?" Bartlett maintains we will never get out of our fiscal difficulties until somebody does something about Grover Norquist. Stockman has stated within the past year or so that anyone who can read a spreadsheet should know we don't just have a spending problem, we have a revenue problem as well.

[Pete]

Originally Posted by Dad

,........."when did it become cool to not pay your fair share of taxes?" ....................

But that's the rub - nobody agrees on what the "fair share" should be.

The % of people putting money in during the year and then the government keeping at least some of it is getting smaller and smaller (EITC, etc). The EITC forks sure ain't paying "their fair share".

[Dad]

I sure as hell can't answer it. The link below does a fairly good job of discussing who pays what. We often forget that income tax is only one of many taxes we pay. I am trying to find an article i read a few years ago comparing total taxes (of all types) paid as a % of earnings by the top 1% verse the the total percent paid by the lowest 20% or so. It was remarkably close--maybe a 2 point spread. I'll post it if I can find it.

http://www.cbpp.org/cms/index.cfm?fa=view&id=3505

[sinjefe]

Originally Posted by Pete

But that's the rub - nobody agrees on what the "fair share" should be.

The % of people putting money in during the year and then the government keeping at least some of it is getting smaller and smaller (EITC, etc). The EITC forks sure ain't paying "their fair share".

That's because the progressive tax system isn't about revenue. It's about power and control. If it were truly about funding the government, we would have a fair tax or flat tax system.

[Dozer523]

Originally Posted by Dad

I sure as hell can't answer it. . . .
http://www.cbpp.org/cms/index.cfm?fa=view&id=3505

Probably, no one can. Because the answer has more to do with how the question is framed and the answer desired. But that is a very interesting article. This is an "ought a read" if you want to stay in the conversation.

[craigepo]

"Fair share" is defined by the people who win elections, period. Obama often talked about the rich paying "their fair share" during the campaign. Can anyone remember him defining the term? Hell no. But he won. So here fairly quickly, we are going to see the democrat definition of "fair share". Expect it to except out a large proportion of the democrat voting base. And since the democrats won, their proposal will be what prevails.

Remember that this country does stuff by vote. Guilt or innocence is determined by the vote of a jury. The Country's policies and directions are decided by the people directly electing governmental representatives, who then make the decisions (or fail to make decisions by never uttering the word "NO", but that is a different topic).

The American people are going to get the government they deserve for the next four years.

[MR2]

Based upon our current system a flat tax would be better and the Fair tax would be best. IMO of course.

At the Fed Level: Optimally IMO, taxes should primarily be levied by the states and not the Fed. So a drastically scaled down Fed would need a 4-6% income tax rate with zero deductions and the balance gained from customs and tariffs. Instead of taking from all and doling out to whom ever, that would fall back to the State.

Transition the current Social Security to a minimally required personal IRA/401k with insurance program. Including a required disability insurance program. Transition Medicare to a personal medical account so people can purchase their own minimally required catastrophic policy, optional medical/dental/etc. policy, and minimally required long-term policy (70 and older). States would cover/ignore those that fall between the cracks.

No corporate or capital gains taxes, revoke all corporate tax breaks, stronger anti-monopoly protections, for US owned/located corporations (and US earned income).

Indexed-rate estate taxes with scaled rates at $1, $10, and $50 million.

At the State level: All taxes at a rate decided upon by the voters of the State. What ever they decide: income, property, sales, sin etc. taxes the State would decide.


The main point is that the Feds get enough to do what they are required to do and everything else is up to the States. The voters have greater control at the State level and those taxes (and spending) will greater reflect their desires. This gives voters a greater option to vote with their feet.

[Pete]

Originally Posted by Dad

I sure as hell can't answer it. The link below does a fairly good job of discussing who pays what. We often forget that income tax is only one of many taxes we pay. I am trying to find an article i read a few years ago comparing total taxes (of all types) paid as a % of earnings by the top 1% verse the the total percent paid by the lowest 20% or so. It was remarkably close--maybe a 2 point spread. I'll post it if I can find it.

http://www.cbpp.org/cms/index.cfm?fa=view&id=3505

That article muddies the waters by mixing taxes.

The Holy Grail of the libs is to remove payroll taxes on the low enders.

SS Tax is an example. The top end tax rate is caped - because the return is caped. If the cap on what has to be paid is removed and the "wealthy" have to pay SS Tax on every thing they earn they are not going to get a proportional return on the amount.

The non-federal payroll taxes are "fair" because they are a fixed rate on what you earn.

Property taxes are "fair" because they are a fixed rate on what you own.

Sales taxes are "fair" because they are a fixed rate on what you purchase.

[1stindoor]

Originally Posted by craigepo

The American people are going to get the government they deserve for the next four years.

Yes they are...but so are the ones that didn't want the government they were given.

[Pete]

Originally Posted by 1stindoor

Yes they are...but so are the ones that didn't want the government they were given.

So that is "fair" - everybody gets the same government.

[1stindoor]

Originally Posted by Pete

So that is "fair" - everybody gets the same government.

Now I didn't anything about "fair." I just said we're getting the same government whether we wanted them or not.

[CSB]

Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one's taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands.

That's Judge Learned Hand.

Taxes are not voluntary contributions by the American people. Taxes are forced extractions because if they are not paid, men with guns will come to your door and take it away from you.

So whether the Congress takes money and uses it for National Public Radio, or to pay for cell phones for "poor people," to give one billion dollars to "victims" of the 911 terrorist attack, or use it to "forgive" college loans, the reality is that men with guns are coming to your house and will take away your money and give it to other people that the Congress thinks deserve it more than you.

That -- in my opinion -- is the true test of the legitamacy of any tax; I call it the "men with guns" test:

Is the government justified in sendng men with guns to your house to take away your money so that money can be spent in ways that you may totally disagree with.

[The Reaper]

Originally Posted by Dad

I highly recommend Bruce Bartlett's "The Benefit and the Burden" for undertanding the tax process. I am going to have to read it twice to grasp everything. The author was Jack Kemp's advisor on tax policy and an economic advisor to Reagan. He has what seems to me as sensible ideas. He is also one of the former Reagan advisors who maintain Reagan could not gain the GOP nomination today. As he has stated in interviews, everyone remembers Reagan cut taxes. every one also forgets he raised them 5 times. Unlike todays GOP, Reagan and George H W Bush hated deficits. I am sure most every one remembers David Stockman's famous comment concerning supply side and trickle down--and Reagan refused to fire him for it. The one line in the book that will always stick in my mind is, "when did it become cool to not pay your fair share of taxes?" Bartlett maintains we will never get out of our fiscal difficulties until somebody does something about Grover Norquist. Stockman has stated within the past year or so that anyone who can read a spreadsheet should know we don't just have a spending problem, we have a revenue problem as well.

I would maintain that if the Federal government limited itself to its Constitutional responsibilities, we would have more than enough revenue right now.

The real problem is the ever increasing encroachment of the Federal government into areas where they have no mandate, and creating unnecessary entitlements.

TR

[GratefulCitizen]

Taxes (with a fiat currency) aren't the true tax burden.
Spending is.

Here's a hypothetical to explain it:
The federal deficit has been running about $1 trillion.

Suppose, by some miracle, the federal budget got reduced next year down to $1 trillion total.
Suppose, also, that the federal government collected $0 in taxes next year.

The deficit would still be $1 trillion, but nobody would pay taxes.
Would this mean there is no tax burden?

There would still be a burden of $1 trillion.
All of those goods and services "bought" by the government were, in fact, confiscated by fiat.

Taxes aren't what matters.
Spending, as a percentage of the economy, is what matters.

<edit>
Concerning the unintended consequences of taxes and subsidies:
http://scottgrannis.blogspot.com/201...raps-poor.html