View Poll Results: Which tax system is most 'fair'?

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  • Progressive Tax

    90 42.25%
  • Regressive Tax

    0 0%
  • Flat Percentage Tax Rate

    104 48.83%
  • Flat Dollar Tax

    5 2.35%
  • Other

    14 6.57%
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Thread: Which tax system is most 'fair'

  1. #201
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    Re: Which tax system is most 'fair'

    Quote Originally Posted by MaggieD View Post
    The Fair Tax is the most fair. Here's what it entails:

    Don't know if it's been introduced again this year, but has been for five or six years until now. The proposed rate on this Fair Tax (basically a national sales tax) is 23%...with rebates back to taxpayers who meet certain income/family size criteria.

    This tax would abolish the Internal Revenue Service saving billions and and dismantle an entire industry whose billions are made helping people fill out the IRS's ever-more-confusing Income Tax Returns. No more tax cheats.
    Like your posts MD but this is wrong.

    Fairytax's "23%" is actually "23% tax inclusive".. which is really 30% (exclusive) the way everyone else on the planet calculates it.
    A $100 item will cost $130. Fairytax calls that "23%" tax inclusive.
    Which "is just the beginning of it's problems".
    http://www.ctj.org/html/nytsales.htm

    It has it's own bureaucracy figuring and giving out prebates. And of course since everyone in the country now has the greatest incentive in history to become scofflaws (and everyone a tax collector), there would be a huge enforcement staff needed to stop the BLACK/cash economy that would result from a 65% sales tax (Fed + State) that would be needed.

    And Independent scoring of Fairytax's even claimed 30% rate is more in the mid 50's% range. (not including state sales taxes, or state income taxes... all of which would have to be converted to sales tax from income tax to make the system even debatable)
    http://webcache.googleusercontent.co...&ct=clnk&gl=us

    See:
    http://www.debatepolitics.com/genera...post1058609584

    and
    http://www.debatepolitics.com/genera...post1058609429

    Another Basic problem being being you just can't reduce the upper 1%'s taxes by 90% without making someone else pay. see http://www.debatepolitics.com/genera...post1058609429
    It's grotesquely regressive.
    To cloak this obvious scam they give a prebate which is supposed to take care of the lower incomes, but of course it doesn't.. especially at the real rate.
    Last edited by mbig; 07-12-10 at 07:24 PM.
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  2. #202
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    Re: Which tax system is most 'fair'

    Quote Originally Posted by The Mark View Post
    Point...

    But still, one would think the reduction in campaign fund total would be noticed...or perhaps not, depending on how much they actually pay in taxes.
    Personally, I think all it means is that the contributors will have to pay out even more contributions to compete for no-bid government contracts. Cut tax revenue will only mean the political corruption will grow.

  3. #203
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    Re: Which tax system is most 'fair'

    Quote Originally Posted by TurtleDude View Post
    fairness has no meaning since it is twisted beyond all recognition

    the most fair tax is a use tax. You pay for what you use.

    the second fairest tax is a consumption tax-everyone has to pay it and the more you engage in transactions, the more you pay. a gasoline tax is a form of that as is a sales tax

    the next fairest tax is a flat tax--true, many people end up paying more than they use just as many pay for far less than they use but the advantage of this tax is that politicians cannot pander to non tax payers or low bracket tax payers with promises of more handouts paid for by those in higher brackets

    a progressive income tax is the worst and least fair because those who pay the most taxes are held hostage by the majority of voters who can continue to vote up the taxes on teh top bracket in order to loot their wealth

    under a progressive tax, the state of having to pay far more than what you use is accentuated.

    morally, no one should have to be forced to care for someone unless the former is responsible for the plight of the latter. to claim that it is fair to make someone shoulder the responsibility of another is clearly specious
    I like the fact that you ranked taxes, I just happen to disagree with your ranking. I personally rank taxes by their degree of "evilness" for the same reason that you cited in your last sentance.

    First of all, if fair means "fair" the way that we are taught when we are in grade school, none of those taxes would be fair. By gradeschool definition, everyone would pay the exact same fee, and equal percentage of the cost of government. So if our budget was $3 trillion bucks, and if we had 300 million people, every person would have to pay $10,000 (if I got all those zeros right). But of course not everyone can pay that much because nto everyone can make that much. So we have no choice other than to find an "alternative" definition of fair.

    Some suggest that the "best" alternative way to allocate taxes would be to base the amount of taxes on the government services that we utilize. Under this alternative, if we utilize school we would pay a school tax, if we utilized the fire department we would pay for that service, if we utilized a cop we would pay the cop, if we utilized a road we may pay at the toll booth. The problem with this option is two fold: first of all, not everyone could afford to pay directly for services rendered, second, it would not be practical to figure out just how much a day of military service was worth to a particular individual (so would someone who supports the war have to pay and someone who does not support the war not have to pay?), and many of these services have value to us even if we don't directly use them (such as even if we dont drive, we still purchase products that are transported over our roads).

    Others suggest that we should pay based on how much we consume, like the FAIR TAX or a simple consumer sales tax. But how much we consume retail products and services has little to do with the value that our government adds to our lives or our pro-rated share of the cost of government, so although a large portion of our population thinks that this is fair, there is really nothing fair about it. Among the different types of consumption tax schemes, a simple consumer is the most efficient and involves the least amount of government interferance in our day to day lives. A direct sales tax does have some practical merit though - it is much easier for our goverment to supervise and collect from and watchdog our retailers than it is to have to deal with every single American or every single worker. Of course this does not eleminate tax cheating by any means - it would still be inefficient to have a tax officer at every cash register in every store and at every booth at every flea market. There is also the potential issue that particular industries will lobby to have their products and services exempt from such tax. A lot of people would easily buy into the arguement that food shouldn't be taxed because it is a nessacity, or that drugs shouldn't be taxed, or that health insurance shouldn't be taxed, or that healthcare service shouldn't be taxes, and then of course if doctors arn't being taxed, our lawyers would want to be tax exempt also, and so would shoe mendors, massage parlors, printers, fuel providers, paper manufacturers, the clothing industry, etc. Ultimately, we may end up with only hairpins being taxed, assuming that the hairpin industry doesn't have a lobbiest coalition in Washington.

    Many people suggest that a value added tax would be more efficient than a simple sales tax because it taxes a much smaller amount than an outright consumer sales tax, and it taxes it at each stage of production supposedly making it less beneficial for an individual company to cheat. That simply isn't true. People who are going to cheat are going to cheat, and those who aren't won't. When comparing the value added tax to a simple sales tax, there would be much more opportunity to cheat. The concept of the value added tax is that only the value (wealth) that a particular individual or company added to the raw good would be taxed. That opens up a zillion opportunities for companies to claim that no value was added to the product. Like if they had a product that they sold for $1.00 that cost them 50 for the raw good, they would then claim that the labor to make it worth a dollar needed to be added to the raw product cost, plus the electricity, plus the amortized portion of the equipment that was used, etc. Ultimately, they would claim no value was added (the value already existed in the form of a lot of different resources, they just consolidated it to one product) and thus they should pay no "value added tax". Another drawback of the value added tax is that it is less efficent that a simple sales tax, under the value added system all businesses would have to keep detailed financial records on every product sold and would have to report to and pay the government, instead of that being limited just to end user retailers. Some value added proponants claim that the producer wouldn't have to directly track every individual element of the cost of each item, that the system could be simplified to just placing the tax on the amount of profit of the business, using the exact same accounting standards that we already have in place. While that sounds very logical, is that really a "value added tax" or is that just another form of "income tax" pretty much identical to the one we already have?

    My largest objection to any type of sales or consumption or value added tax is that it directly adds to the cost of the final user product, thus it provides a disincentive for people to consume thus reducing sale and thus penalizes companies and individuals that want to be productive. Why would we want to discourage being productive? I know that the OP didn't ask for a lecture on my personal views on taxes, but any type of tax that disinsentives a company from making products that other could enjoy or disinsentivies consumers from purchasing products that they will utilize can not be considered as "fair".


    OK, so the "Flat Tax", that must be fair then. Or is it? What the heck does "flat tax" mean? If I didn't already know better and someone used that term, I would assume that they meant my "everyone pays exactly the same amount" type of tax. But when we say "flat tax" that is not at all what is usually intended. All a flat tax is, is an income tax with just one tax bracket. It is really has no different effect than our current "progressive" income tax system. Under the flat tax, people who have small incomes would pay very little (although they would likely pay more than they do now), and people with big income would likely pay less than they do now. The way I see it, a flat tax is just another ploy of the elite for them to become richer - on the backs of the poor and lower middle class. If one says that our current progressive income tax system is not fair, then the flat tax would not be fair either. You see, it is still progressive. The more you make the more you pay! The flax tax is just a slight twist on what we have now and would solve absolutely nothing.

    Now I really wouldn't object to a flat tax if it had a built in minimum amount of income that one had to make before it kicked in. If it was a two tax bracket system (but then that kind of defeats the purpose of elitist wanting a flat tax doesn't it), lets say a basic minimium living amount (much like the current personal exemption and the standard deduction that we now have) was not taxable, and every dollar one made above that amount is taxable and everyone who makes over that amount pays the exact same tax rate regardless of anything. I would suggest that the flat tax not kick in until people are making wages far higher than normal, something in the neighborhood of $400,000 (which is about 10 times the average income and about the same as the highest paying normal job - medical doctor specialists). Then anything that one makes above that amount is taxed at a pretty high rate, but everyone gets the same $400,000 exemption. Their would be some fairness to that tax because it would allow everyone the opportunity to make as little as they want or as much within normal expectations as they can before they have to pay anything. Of course the rich wouldn't think that is fair, but then again they would be getting the same $400,000 exemption (which is a heck of a lot more exemption than they get now). And of course to make it fair, we should treat all sources of income just the same. This means eliminating the special discount that we give for "capital gains" and taxing that income just exactly the same way we tax income from work. It also means eleminating tax credits (after all, refundable tax credits are really tax breaks, they are just another form of welfare). I would also tax one time income source, such as inheritance or winning a personal injury lawsuite or gambling winnings (lottery) just the same way. After all, if we are talking fair, fair means equal.

    Probably the fairest of all taxes would be the inheritance tax. Ironically, this year we have no federal inheritance tax. But an inheritance tax is fair because it taxes something that others did not earn. I would go so far as to suggest that a 100% tax on inheritance would be perfectly fair. Conservatives will typically say that "we have to end this entitlement society" and that "you are not entitled to anything you didn't earn". Well, inheritance is exactly something that you did not earn. The dead person earned it, it was his "excess" in life (meaning that it was what was not consumed), why the heck should anyone get it? Certainly we are not going to distroy the assets of the dead because they still have value to our society, but why should a particular individual get posession of those assets that they did not earn? A lot of people would answer that question with: "because it was the desire of the guy who earned the assets". But that is ludicris, the guy is dead and has no desire. Maybe he would have liked to see a particular person or group get the money but now he is dead and really doesnt care. So since the dead persons assets still have value, it is quite natural that the value of those assets be transfered to all of mankind (or at least all people in a particular country). With a high death tax, that means that the living can be taxed at a lower rate. I would actually like to see our government so small, and our individuals so wealthy, that inheritance tax would be the only form of tax nessasary. That may not be practical, but inheritance tax should surely be a large portion of our tax base. But is it really impractical? If I went my entire life without having to pay any form of taxes whatsoever, I would think that I would die richer. If everyone was rich at the time of death, that would be a heck of a lot of income for the government. Inheritance tax tends to reset our economy, just a little bit at a time. The rich tend to get richer, and the wealth that the rich hold can not be held by the middleclass. So by ending the cycle of the rich transfering that wealth from generation to generation with each generation either continuing to grow the wealth or deciding to waste the wealth (by not working), more wealth becomes availabe to people who actually have to work for it. So I would say that inheritance tax is the fairest tax.

  4. #204
    Villiage Idiot
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    Re: Which tax system is most 'fair'

    Exactl!!! The Fair Tax is the biggest scam of all.

    On top of the stuff you brought up, the "prebate" is nothing but a huge welfare program. No if the prebate was to replace current welfare programs, maybe that would be an improvement over our current welfare system, but it is IN ADDITION TO current welfare programs.

    And the Fair Tax people claim that product prices will drop 30% because they figure that there is a 30% hidden tax already in our products. Why the heck do they think that import prices would drop just because we ad a 30% tax? Someone in France making a good bottle of wine isn't goint to give us a 30% discount just because we are adding a tax to the cost of their product, they still want to get paid in full for their product. And if producers already pass along there income taxes to consumers in the form of a 30% hidden tax, they exactly what difference would having the Fair Tax make? The end result is that the cost of US manufactured product X would still cost the average worker Y in hours of work. There is exactly no difference in net income to the government and no difference to the average tax payer, but the rich tax payer would get a huge break while the lower income tax payer would be screwed.

    When I first read about the Fair Tax it sounded really good. Then I spent some time actually thinking about it with my own mind (as opposed to just reading propaganda) and discovered that it is terrible. I could rant all day about the stupidity of the "Fair Tax".
    Last edited by imagep; 07-12-10 at 08:04 PM.

  5. #205
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    Re: Which tax system is most 'fair'

    Quote Originally Posted by mbig View Post
    Like your posts MD but this is wrong.
    I checked out your first link -- very interesting. I'll check the others later. Thank you for the information.
    The devil whispered in my ear, "You cannot withstand the storm." I whispered back, "I am ​the storm."

  6. #206
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    Re: Which tax system is most 'fair'

    Quote Originally Posted by imagep View Post
    ...An interesting Wall of Text that I actually read all of...
    What would be your opinion on Property taxes then?
    Education.

    Sometimes I think we're alone. Sometimes I think we're not. In either case, the thought is staggering. ~ R. Buckminster Fuller

  7. #207
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    Re: Which tax system is most 'fair'

    Quote Originally Posted by Gipper View Post
    It seems like the people here who feel like punishing success (aka progressive) seem to ninja in here with their liberal vote and smokescreen out just as fast without an input of why they would do that.

    Until I hear otherwise, the default answer is "they're rich, I'm not, and I'm jealous".
    Gipper, I have never cast a liberal vote in my life, but I agree with people who think that the progressive tax is the fairest. We should all pay taxes based on the benefit that government services provide us with. The larger ones income, the more benefit from government services that one gains, and thus the progressive tax is the fairest of those on the list (although inheritance tax is fairest of all).

  8. #208
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    Re: Which tax system is most 'fair'

    Property taxes suck. Our constitution gives us the right to own property. Any taxation on that property is an infringement on that right. Also, generally when we purchase property we have already paid taxes on the money that we use to purchase the property, and when someone sells property, he has to pay taxes on any money that he made by selling the property - so property tax amounts to triple taxation!

  9. #209
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    Re: Which tax system is most 'fair'

    Sounds fair enough to me!

  10. #210
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    Re: Which tax system is most 'fair'

    Quote Originally Posted by imagep View Post
    Property taxes suck. Our constitution gives us the right to own property. Any taxation on that property is an infringement on that right. Also, generally when we purchase property we have already paid taxes on the money that we use to purchase the property, and when someone sells property, he has to pay taxes on any money that he made by selling the property - so property tax amounts to triple taxation!
    Personally, I do not think property tax should exist at all.
    Education.

    Sometimes I think we're alone. Sometimes I think we're not. In either case, the thought is staggering. ~ R. Buckminster Fuller

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