"Taxes that Work" proposal: eliminate income tax for
samefacts.com
samefacts.com
The best way to counteract inequality is by raising more
revenue and then spending it on things that the middle and
lower classes need, like national health insurance.
[The plan] also wrecks much of the political support for
tax expenditures...
And perhaps most important, his plan gives the American
welfare state a much sturdier base for future expansion
(esp. since the VAT is less transparent than other forms
of taxation), especially since there's room here to add
some form of carbon tax, which is necessary for dealing
with global warming and would provide even greater
revenue going forward.
1. An expansion of the welfare state is a horrifically bad idea. A smaller welfare state is an advantage, in all kinds of ways: economically, demographically, and with respect to liberty and (little-r) republicanism.
2. Making the functions of government less transparent is a goal?
3. Carbon taxes are not necessary to "deal with global warming". Assuming that whatever part of global warming we actually have any ability to affect is significant enough to matter (evidence suggests otherwise, and in any case is far from settled), capitalist market responses would be vastly better at "dealing" with it than anything the gubmint could do with carbon tax revenues (which may not actually increase overall government revenues).
4. I hate the phrase "going forward".
> capitalist market responses would be vastly better at "dealing" with it than anything the gubmint could do with carbon tax revenues
Carbon taxes have two sides, the costs and the revenues. The costs do work with and contribute to the capitalist market responses, by making more polluting products more expensive, relative to the less polluting.
On the revenues side, I agree again, but why not use that money for general expenditures? Why not tax the bad things (pollution & other negative externalities) more, and the good things less (sales, income, investment)?
for example, Steve jobs earns $1 a year from apple as CEO, do you think he cares what income tax costs are?
instead he relies on stock sales, or capitol gains. so steve is wealthy enough that he can target his sale of stock to +/- a decade, in the mean time he can borrow money at below inflation rates against his assets, so he does not even have to sell a stock to reap its benefits. so someone like Steve will decide when the political climate is right to buy and sell stock(avoiding taxes, through credit). (high interest rates, make this unlikely, and puts pressure on stocks to beat interest rates) so in high interest rate periods, paying taxes might be cheap, compared to loosing gains. saving pulls money out of the economy and strengthens the currency, as the economy is less leveraged. strong currencies make it easier to buy forgien goods and resources, as people want to trade now on your currency, as they expect its value to increase in the short term.(this is one possible way to bring gas prices down through raising interest rates)
so, lets say that old Steve sells some stock, regularly, that means that the rest of us have the chance to buy it at a good price and we might see gains at 20-50% in a year, this is good for everyone. it increases trading volume and makes the market more fluid (and yes volitile). however volitile markets are how you make money. it makes much better use of your fiscal efforts, than labor based activities. So, its good for Steve to sell more often with fewer capitol gains taxes. adding taxes to capitol gains will probably reduce trader volume, and depress stock prices, effecting the leveraging power of companies, and resulting in a lower GDP.
so other devices that wealthy use include dividends which right now are taxed at 15%. (politicians want to raise this too) low dividends also keep people seeking investments that share their earnings, so wealthy companies "share" their wealth with investors inorder to keep the avalible levarage of their company up. again low taxes are better.
i think the single best way i have seen to generate revenue for the government was based on a proposal from warren buffet, whe he suggested a transaction tax of 0.3% on all transactons, or account transfers. he suggested that the tax could easily be added to all software, and if you buy a stock, you pay 0.3% on the cost of the purchase, if you sell it, you pay 0.3% on its sale. so as money moves around the economy, it generates revenue for the government. as a wealthy person, you can not escape it, you would need to move your money around to get better than 12% anual returns, so you would always pay the tax, and 0.3% on 1,000,000, is only $3k which might hardly be worth the effort of someone else to find a work around. the idea is that a single dollar might be party to several of these transactions a month.
taxing, or punishing the rich, does not make for a better economy.