<p>Who is for a fair/flat tax and why?</p>
<p>I think fair taxes are ones that others pay.</p>
<p>I lived in the UK they have what is called VAT (value added tax), everything you buy has a flat 15% added, which is what is being proposed. There is no IRS system, there is a poll tax (RE tax)</p>
<p>bulletandpima- when you pay the 15% to the store owner -what government agency makes sure the store owner turns the money over to the government?</p>
<p>That agency is the “IRS system”</p>
<p>I suspect the many people who work at and who deal with Inland Revenue would be surprised to hear that there is “no IRS system” in the UK. There most certainly is. What’s more, they have an income tax, too, just like we do, except that a smaller percentage of the population has to pay it, and VERY hefty National Insurance Contributions (the equivalent of FICA here).</p>
<p>In the UK there is no IRS situation. I am not a supporter of the UK system in regards to VAT or NHS. Trust me if anyone wants to know the horrors of NHS, I can give them my own personal experience…have the scar still to prove it. </p>
<p>The income tax is called POLL TAX. And the Brits pay taxes on everything. They actually have a min-van that drives around at night and zaps your house for a tv signal…if you didn’t pay the tv tax, they’ll get you.</p>
<p>Finally what I meant by IRS system is spending many hours of our time filling out tons of forms. I am not speaking about the IRS per se, I am speaking about filing forms upon forms</p>
<p>JHS- that is my main problem with the advocates of the Fair or Flat Tax- they always use the argument “and there will be no more IRS”. They are either intentionaly misleading or foolishly naive. I work in the tax collection area (not Federal) and if the public really knew how much money was collected for the government but never turned in by businesses the would demand the IRS quit being so soft. When you buy a car do you want the dealer to keep the Sales Tax, how would you like your boss keeping your withholding taxes or social security tax from your pay check. Those “trust” taxes are the taxes that the IRS and State Revenue departments collect.</p>
<p>I am for a fair tax - a progressive tax on assets, and a 70% top income tax rate for the rich.</p>
<p>I’m for a fair tax - everyone pays the same amount of money (with a cutoff for the lower end of the income range) - i.e. no percentage rate.</p>
<p>So ucsd- you would favor everyone paying zero tax on the first $50k of income and a tax rate of 75% on income over $50k or do you want everyone to pay $10,000 but anyone earning under $20k is exempt?</p>
<p>I’m in favor of everyone paying the same too. $10 million per person per year. </p>
<p>If you don’t have the money, just give everything you have and you can just owe the rest with interest compounding continously at 1% over the Libor rate. </p>
<p>And when you die… your tax bill goes to zero.</p>
<p>We don’t want any death taxes.</p>
<p>Don’t tax you, don’t tax me, let’s tax the guy behind the tree.</p>
<p>Have the same progressive system, but halve the rates (meaning the top bracket is 17.5%), and no tax deductions or credits-for anything. One tax scale regardless of filing status. And adjust every year at 2x inflation. Abolish the AMT. And then withhold. That way, you know exactly how much you’re getting back-zip. But at the same time, you don’t have to fill out forms, sit at H&R block for hours on end, or anything like that.</p>
<p>bulletandpima: the Uk doesn’t have an IRS system in which they file returns, but they certainly have an income tax, on top of the VAT. And their income tax has deductions for things like children. The only difference is they approximate it, take the taxes out, and don’t reconcile at the end of the year.</p>
<p>A flat tax here will never happen. Too many changes to the way things work in this country. What would happen to charitable contributions? And I don’t think high income earners should pay the same percentage as lower income people.</p>
<p>Maybe a thougth to redirect the conversation. My big beef is not with the IRS, but ith the tax code currently in use. I mean, who enjoys the current system, where we spend hours trying to figure out what we owe. And every “expert” you go to gives you a differnet answer.<br>
Simplifying th etax code should be our first priority.</p>
<p>I like the old joke I saw a few years back concerning a simple tax form:</p>
<p>Line 1: what did you earn last year
Line 2: Make a check out for that amount to the US Government. :)</p>
<p>Would you rather have to spend a little time figuring out your taxes, or pay more under the fair tax? </p>
<p>Well over 90% of the taxpayers would pay more under the “fair tax”. </p>
<p>Look and see what the tax rates are for different income levels under the income tax and what they would be under the fair tax. Look at what income would no longer be taxed at all under the fair tax. </p>
<p>Here. This is before any deductions. This doesn’t take into account capital gains allowances, tax free munis, dividend tax rates, etc. which are taxed at much lower levels. </p>
<p>[What</a> Federal Tax Bracket Are You In?](<a href=“http://www.axaenterprise.com/education/tax/brackets.asp]What”>http://www.axaenterprise.com/education/tax/brackets.asp)</p>
<p>I really don’t see income taxes as very high.</p>
<p>You might get a better idea using this.</p>
<p>[2007</a> Federal Tax Rate Schedules](<a href=“http://www.irs.gov/formspubs/article/0,,id=164272,00.html]2007”>http://www.irs.gov/formspubs/article/0,,id=164272,00.html)</p>
<p>tom1944:</p>
<p>No, not a rate - just a flat amount based on what the overall tax assessment is. Divide the overall tax assessment by total number of taxpayers and that’s what each person would pay. There’d have to be some cutoff since the amount to pay would likely exceed some people’s income. It’d be fair since everyone would be paying the same amount - just like we all pay for items on a flat amount rather than a rate scale (except for the low income earners who won’t pay anything - they’d be getting an unfair advantage as they are now). I’m not saying it’s practical but it’d be fair IMO.</p>
<p>Line 1: What did you earn last year
Line 2: What did you spend on work-related expenses
Line 3: How much did your employer reimburse you for it
Line 4: Line 2-3
Line 5: How much money did you LOSE on your investments
Line 6: How much money did you LOSE from your business (if you have one)
Line 7: How much did you donate to charity
Line 8: How much did you spend on educational expenses (tuition, room and board) for yourself or a dependent for any level of education
Line 9: Line 1-Line 4-Line 5-Line 6 (if applicable)-Line 7-Line 8
Line 10: How much did your employer withhold
Line 11: Calculate total tax owed (applicable rate*line 9)-if line 11 is negative, enter the negative amount. (ex if line 11 is -4000, put -4000)
0-20000: 0+1% for any amount below zero
20000-40000: 200+4% of any amount above 10k
40000-70000: 1600+7% of any amount above 40k
70000-200000: 4900+11% of any amount above 70k
200000-500000: 22000+13% of any amount above 200k
500000-1.5 mil: 65000+17% of any amount above 500k
1.5 mil-3.5 mil: 255000+21% of any amount above 1.5mil
3.5mil+: 735000+25% of any amount above 3.5mil
Line 12: how much was credited from last year (include last year’s tax form)
Line 13: Line 11-Line 10-line 12
If line 12 is positive, please enclose a check for that amount
If line 12 is zero, simply return this form
If line 12 is negative, please choose from the following options:
-I would like to credit this amount to next year’s tax bill
-I would like a check
-I would like to have it direct deposited
-I would like to donate it to a charity of my choice (specify)</p>
<p>Thank you for using the Internal Revenue Service.</p>
<p>futurenyustudent, line 8 cracks me up.</p>
<p>You want taxpayers to subsidize the price of a NYU education?</p>
<p>I see you read Curmudgeon’s post #12. lol</p>
<p>It’s still easier than the 70+ lines you fill out on your current 1040.</p>