Wednesday, June 20, 2012

A Simple Tax Plan for Everyone

OK, I terribly neglect my blog in favor of short statements and discussions. This one needs to be finished and thankfully it doesn't have to be that long. We spend so much time arguing over raising or lowering taxes and the truth is, our tax code is way to complicated for anyone to make an educated assessment of how it could be "reformed" - which in and of itself is a joke. Here's my plan, which is still somewhat a work in progress but I think I've covered most everything.

Tax "reform" is a very complicated issue which really doesn't have to be. The left has created class warfare by vilifying the rich for a tax code which favors them in many ways but also completely exempts the poor. Of the two, I guess the latter is more palatable but it is not acceptable when you consider how many people who receive benefits do nothing in return and don't try to move beyond them. The rich definitely use the system as it is to keep more of what they have but so does everyone else - this is human nature. Even my uberliberal parents deduct every single thing they can and spend hours, days, WEEKS doing so.

I am a firm believer that we have a moral obligation to take care of those truly in need but we have a moral and practical obligation to not provide long-term handouts for those who don't; otherwise we won't be in a position to take care of anyone.

We can argue about what is "fair" - is it "fair" to take more of what a rich person earns? I don't know - but I do know it is the right thing to do. It is certainly more "fair" to the country that helped create their wealth and they can indeed afford it and it is income that is not entirely taken up by basic necessities. However, paying nothing is not an option. Even if you just pay a filing have the same protection of our military and the use of our roads. Perhaps if everyone has to pay even a nominal filing fee it will encourage more people to have a stake in their government and hold it accountable for wasteful spending and tolerating fraud and abuse.

The tax code is an abomination and it is so complicated we cannot make an educated decision on anything. My solution is simple and the tax code could be reduced to a flyer:

1) Graduated, semi-flat tax
2) Little to no deductions, no loopholes
3) Everyone pays a little; the more you earn the higher your percentage
4) All income treated the same whether earned, capital gains or other
5) Similar measures for corporate taxes
6) Small national sales tax to garner revenue from the underground economy
7) Eliminate cap of FICA tax (social security contribution)
8) Eliminate or drastically downsize the IRS, saving taxpayers billions
9) Reduction in the death tax except perhaps for the VERY wealthy - it's already been taxed and is a burden on those who aren't wealthy and inherit property

As a side note, I also advocate resurrecting the WPA. If we are going to spend money supporting people who aren't working, why not have them work if they can or train them for other jobs or to go back to school? It beats having them sit around. Even many disabled people are capable of some kind of work.

Unintended consequences: CPA's and tax attorneys may have to find more productive work than helping citizens forced to negotiate with an egregious and immoral tax code. Sorry guys - the needs of the many outweigh the needs of the few. Live long and prosper.

Any questions?

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