How Taxes Work...

[CanOWorms]

It's interesting how one general group of people supports restricting financial liberty but not civil liberties, but the other group supports restricting civil liberties but not financial liberty. It's pretty sad to see what America has become when both of the largest groups represent evil.

 

[Aisengard]

Originally posted by: pinion9
Someone, please explain to me what is wrong with flat tax? It is like a concert admission: you want in, pay this much. If everyone in America paid $5000/year to live here, we would all be happy. If you can't afford to live here with our nice roads and freedoms, then move somewhere else.

The problem with the flat tax is that rich people inherently hear more of what you call the 'concert'. Check my previous post, and take for example a CEO or upper-level manager of an international corporation. They not only benefit from all the extra public roads their company uses, but also from the United States' military and diplomatic protection, which is using much much more of the public funds than your typical American laborer.

 

[pinion9]

Originally posted by: Aisengard

Originally posted by: pinion9
Someone, please explain to me what is wrong with flat tax? It is like a concert admission: you want in, pay this much. If everyone in America paid $5000/year to live here, we would all be happy. If you can't afford to live here with our nice roads and freedoms, then move somewhere else.

The problem with the flat tax is that rich people inherently hear more of what you call the 'concert'. Check my previous post, and take for example a CEO or upper-level manager of an international corporation. They not only benefit from all the extra public roads their company uses, but also from the United States' military and diplomatic protection, which is using much much more of the public funds than your typical American laborer.

Everyone has the same opportunity to become a CEO. How do I benefit more from the public roads and military than my wife? Hell, she drives on the roads more than I do. She should be paying more, not me. Don't people pay for the roads with their fuel tax? More driving = more fuel consumed = they are paying for the road.

 

[Genx87]

Originally posted by: Aisengard

Originally posted by: pinion9
Someone, please explain to me what is wrong with flat tax? It is like a concert admission: you want in, pay this much. If everyone in America paid $5000/year to live here, we would all be happy. If you can't afford to live here with our nice roads and freedoms, then move somewhere else.

The problem with the flat tax is that rich people inherently hear more of what you call the 'concert'. Check my previous post, and take for example a CEO or upper-level manager of an international corporation. They not only benefit from all the extra public roads their company uses, but also from the United States' military and diplomatic protection, which is using much much more of the public funds than your typical American laborer.

And as you know as a CEO of a corporation you also pay for that benefit by paying half of your workers payroll taxes.

And if you are the owner subjected to double taxation. I have heard of small business owners when all is said and done paying upwards of 50% of their income in taxes when all is said and done.

 

[ECUHITMAN]

Originally posted by: Genx87
lmao so true.

Let me guess, we should not tax the rich on their income and should double the tax on the middle class and triple it on the poor out of the fear that we might drive the rich from the country?

 

[dullard]

1) That has nothing at all that is similar to our tax system. The poor also pay payroll taxes, property taxes, sales taxes, indirectly pay corporate income taxes, etc. And some of the poor get welfare. You are only looking at one piece of a much larger puzzle. But I can allow errors in your numbers and still play the game.

2) What is wrong with just altering the bottom tax bracket? Why adjust all the tax brackets? Suppose in this case, the bottom tax bracket was set to a higher income level. What would happen? Everyone would get $4 back, but those who paid $4 or less will pay nothing (and recieve nothing). The result:

Man: Original / My cut / Your cut
1: 0 / 0 / 0
2: 0 / 0 / 0
3: 0 / 0 / 0
4: 0 / 0 / 0
5: 1 / 0 / 0
6: 3 / 0 / 2
7: 7 / 3 / 5
8: 12 / 8 / 9
9: 18 / 14 / 12
10: 59 / 55 / 52
Tota: 100 / 80 / 80

A flat $4 meal cut for everyone seems like a nice and fair meal cut method. You'd (a) get more people with free meals than your method. (b) get more tax cut to the middle class and even lower upper class than your method. (c) The wealthy still get a sizable tax cut, as much or more than anyone else. (d) You avoid the arguments that you had in your case about man 8 getting less of a cut than man 10. You won't avoid the poor complaining but your math was flawed to begin with on the poor, so we can't address that in this little analogy.

 

[HombrePequeno]

Originally posted by: Genx87

Originally posted by: Tom
More realistic would be the dinner goes up to $150, so the men decide to borrow $100 and use $50 of the borrowed money to reduce the rich guys taxes to $9.

And all ten mens' children, even the poor ones, get to pay the $100 loan back.

Top 5% of this country pays 53% of the taxes.
Not quite how you are making it sound.

The bottom 50% pays 6%, poor pay little to no federal income tax in this country.

Do you think the poor should pay more? If you have just enough money to pay the bills and nothing to put into savings, a higher tax rate for you is just going to hurt you. Poorer people generally have to dip into their savings to pay the bills.

Personally, I think the tax rates we have right now are just fine. I kind of would have preferred there weren't any tax cuts so we could be paying off our deficit right now, but what's done is done, I guess. I would suggest revising the tax code, however, to make it simpler. Too much time and money is wasted just doing your tax return. The committee that Bush set up for tax reform had some good ideas but because of Bush's extremely low popularity, there's no way it will ever get passed.

 

[Tom]

Originally posted by: CanOWorms
It's interesting how one general group of people supports restricting financial liberty but not civil liberties, but the other group supports restricting civil liberties but not financial liberty. It's pretty sad to see what America has become when both of the largest groups represent evil.

I don't know what groups you are talking about, but in response let me say I don't see my Democratic party as restricting financial liberty, if that's what you're saying.

If you start from a position of wanting equal opportunity for everyone, which is fundamental to financial liberty, then society has certain obligations to establish a level playing field.

Also, the larger the universe where-in the financial liberty is going to happen, the more opportunity there will be, leads to decisions like electrification, building roads and dams, etc.

And we could make a society that's only goal was the immediate gratification of those that are now living, but that's pretty short sighted and stupid.

 

[Aisengard]

Originally posted by: pinion9

Originally posted by: Aisengard

Originally posted by: pinion9
Someone, please explain to me what is wrong with flat tax? It is like a concert admission: you want in, pay this much. If everyone in America paid $5000/year to live here, we would all be happy. If you can't afford to live here with our nice roads and freedoms, then move somewhere else.

The problem with the flat tax is that rich people inherently hear more of what you call the 'concert'. Check my previous post, and take for example a CEO or upper-level manager of an international corporation. They not only benefit from all the extra public roads their company uses, but also from the United States' military and diplomatic protection, which is using much much more of the public funds than your typical American laborer.

Everyone has the same opportunity to become a CEO.

Haha, hahaha, ohhh how idyllic (or willfully ignorant) you are.

How do I benefit more from the public roads and military than my wife? Hell, she drives on the roads more than I do. She should be paying more, not me. Don't people pay for the roads with their fuel tax? More driving = more fuel consumed = they are paying for the road.

No, people pay for fuel with their fuel tax. Ask yourself what do people pay for when they pay sales tax? And consider the usage of the roads. A man uses the roads to get to work...but a company not only uses roads to get their employees to work, but to sell their products, which gives much, much more return. Your average laborer does not have this chance.

And it's not just roads and military, that was one of thousands of examples. The rich inherently consume more than the poor in the accumulation of their wealth. Get over it.

 

[Tom]

Originally posted by: Genx87

Originally posted by: Aisengard

Originally posted by: pinion9
Someone, please explain to me what is wrong with flat tax? It is like a concert admission: you want in, pay this much. If everyone in America paid $5000/year to live here, we would all be happy. If you can't afford to live here with our nice roads and freedoms, then move somewhere else.

The problem with the flat tax is that rich people inherently hear more of what you call the 'concert'. Check my previous post, and take for example a CEO or upper-level manager of an international corporation. They not only benefit from all the extra public roads their company uses, but also from the United States' military and diplomatic protection, which is using much much more of the public funds than your typical American laborer.

And as you know as a CEO of a corporation you also pay for that benefit by paying half of your workers payroll taxes.

And if you are the owner subjected to double taxation. I have heard of small business owners when all is said and done paying upwards of 50% of their income in taxes when all is said and done.

I hear small business owners complaining about this all the time down at the country club..

It really is a shame that Jay Leno only has 3 Duesenbergs, stupid poor people !!

(nothing against Jay, just what occured to me)

 

[ECUHITMAN]

Originally posted by: pinion9
Someone, please explain to me what is wrong with flat tax? It is like a concert admission: you want in, pay this much. If everyone in America paid $5000/year to live here, we would all be happy. If you can't afford to live here with our nice roads and freedoms, then move somewhere else.

Some people do not make 5K a year, so how do you expect them to pay the 'flat tax'? And even more only make double or triple that amount. With a 15K yearly income how are they going to survive on 10K after this flat tax.

Second, if half the US population paid 5K a year that would equal: 750 Billion. I picked half because you can?t honestly expect children and old people to work.

750 billion is a bit short of the 2.4 trillion the US SPENDS per year. Even if you doubled it to 10K a year in tax we would be short by 1 trillion dollars.

 

[dullard]

Originally posted by: ECUHITMAN
Second, if half the US population paid 5K a year that would equal: 750 Billion. I picked half because you can?t honestly expect children and old people to work.

750 billion is a bit short of the 2.4 trillion the US SPENDS per year. Even if you doubled it to 10K a year in tax we would be short by 1 trillion dollars.

No, children and elderly use government services too. Thus since he is after a true flat tax, they should pay it too. And bump it up to $8000/person. Then we'd hit the break-even point. $2.4 trillion in, $2.4 trillion out.

A family of five who is supporting one of their four grandparents then must pay $48000 per year in taxes. No deductions, no credits because we want it to be truely flat.

Oh wait, the median household income is ~$45,000 per year. That's ok, they can go into debt to pay the remaning $3000 of taxes. Wait, they have no money for housing, food, utilities, clothing, etc. No problem, they can move to another country.

 

[CanOWorms]

Originally posted by: Tom

Originally posted by: CanOWorms
It's interesting how one general group of people supports restricting financial liberty but not civil liberties, but the other group supports restricting civil liberties but not financial liberty. It's pretty sad to see what America has become when both of the largest groups represent evil.

I don't know what groups you are talking about, but in response let me say I don't see my Democratic party as restricting financial liberty, if that's what you're saying.

If you start from a position of wanting equal opportunity for everyone, which is fundamental to financial liberty, then society has certain obligations to establish a level playing field.

Also, the larger the universe where-in the financial liberty is going to happen, the more opportunity there will be, leads to decisions like electrification, building roads and dams, etc.

And we could make a society that's only goal was the immediate gratification of those that are now living, but that's pretty short sighted and stupid.

Any taxes is a restriction on financial liberty. A 30% income tax is a 30% reduction in your freedom. You're placing restrictions on someone supposedly for the benefit of the society as a whole, however it's no different than restricting civil liberties for the safety of the society as a whole. Both groups are essentially the same - they wish to take away from the individual.

Obviously a balance needs to be achieved, but I personally feel that taxes are too high for what little the government does.

 

[ECUHITMAN]

Dullard -
Oh what was I thinking... You are right. I agree with you, they should move to Mexico or something. Who cares about 95% of the population?

LOL

 

[HombrePequeno]

Originally posted by: dullard

Originally posted by: ECUHITMAN
Second, if half the US population paid 5K a year that would equal: 750 Billion. I picked half because you can?t honestly expect children and old people to work.

750 billion is a bit short of the 2.4 trillion the US SPENDS per year. Even if you doubled it to 10K a year in tax we would be short by 1 trillion dollars.

No, children and elderly use government services too. Thus since he is after a true flat tax, they should pay it too. And bump it up to $8000/person. Then we'd hit the break-even point. $2.4 trillion in, $2.4 trillion out.

A family of five who is supporting one of their four grandparents then must pay $48000 per year in taxes. No deductions, no credits because we want it to be truely flat.

Oh wait, the median household income is ~$45,000 per year. That's ok, they can go into debt to pay the remaning $3000 of taxes. Wait, they have no money for housing, food, utilities, clothing, etc. No problem, they can move to another country.

What he seems to be arguing for is a head tax, not a flat tax. Head taxes are horribly regressive. I really don't see how anyone could argue for a head tax.

 

[ECUHITMAN]

Originally posted by: CanOWorms

Originally posted by: Tom

Originally posted by: CanOWorms
It's interesting how one general group of people supports restricting financial liberty but not civil liberties, but the other group supports restricting civil liberties but not financial liberty. It's pretty sad to see what America has become when both of the largest groups represent evil.

I don't know what groups you are talking about, but in response let me say I don't see my Democratic party as restricting financial liberty, if that's what you're saying.

If you start from a position of wanting equal opportunity for everyone, which is fundamental to financial liberty, then society has certain obligations to establish a level playing field.

Also, the larger the universe where-in the financial liberty is going to happen, the more opportunity there will be, leads to decisions like electrification, building roads and dams, etc.

And we could make a society that's only goal was the immediate gratification of those that are now living, but that's pretty short sighted and stupid.

Any taxes is a restriction on financial liberty. A 30% income tax is a 30% reduction in your freedom. You're placing restrictions on someone supposedly for the benefit of the society as a whole, however it's no different than restricting civil liberties for the safety of the society as a whole. Both groups are essentially the same - they wish to take away from the individual.

Obviously a balance needs to be achieved, but I personally feel that taxes are too high for what little the government does.

While your attempt at trying to connect freedoms to paying tax is poor, I wish there was some way to pay less taxes. That said, I would not agree to pay less tax if things were worse than they are today.

Also, just so you know most people in this country do not pay 30% tax. According to the IRS as a single person you would have to make more than $150,000 per year to pay even 28% of your income.

If you would like to learn how federal taxes work:
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf

 

[3chordcharlie]

See, the problem is that instead of 'making the meal cheaper because we like you' we make the meal more expensive (and less tasty), but put most of it on a shared credit card, then reduce the tenth man's share, and call it progress.

 

[ECUHITMAN]

Originally posted by: HombrePequeno

Originally posted by: dullard

Originally posted by: ECUHITMAN
Second, if half the US population paid 5K a year that would equal: 750 Billion. I picked half because you can?t honestly expect children and old people to work.

750 billion is a bit short of the 2.4 trillion the US SPENDS per year. Even if you doubled it to 10K a year in tax we would be short by 1 trillion dollars.

No, children and elderly use government services too. Thus since he is after a true flat tax, they should pay it too. And bump it up to $8000/person. Then we'd hit the break-even point. $2.4 trillion in, $2.4 trillion out.

A family of five who is supporting one of their four grandparents then must pay $48000 per year in taxes. No deductions, no credits because we want it to be truely flat.

Oh wait, the median household income is ~$45,000 per year. That's ok, they can go into debt to pay the remaning $3000 of taxes. Wait, they have no money for housing, food, utilities, clothing, etc. No problem, they can move to another country.

What he seems to be arguing for is a head tax, not a flat tax. Head taxes are horribly regressive. I really don't see how anyone could argue for a head tax.

Well if pinion9 and Genx87 got their way a head tax would be the only way we could break even with the current amount of spending.

 

[dullard]

Originally posted by: ECUHITMAN
Also, just so you know most people in this country do not pay 30% tax. According to the IRS as a single person you would have to make more than $150,000 per year to pay even 28% of your income.

If you would like to learn how federal taxes work:
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf

Not really EcuHitman. Even a single person making $150,000 pays far less than 24% income tax (and this thread is clearly just about federal income tax like I said in my post above). At $150,000 taxible income, you will have paid $36,506.50 in taxes. That is 24.3%. And someone like that has deductions and credits, so that 24.3% is really too high. Using that logic, the single person who ignores deductions and credits needs a yearly income of $303,000 to pay 30% income taxes.

 

[zephyrprime]

Originally posted by: pinion9
Someone, please explain to me what is wrong with flat tax? It is like a concert admission: you want in, pay this much. If everyone in America paid $5000/year to live here, we would all be happy. If you can't afford to live here with our nice roads and freedoms, then move somewhere else.

It would actually be ~$9000 for every man woman and child in the US for fiscal year 2006. That'd be ~$37000 for every family of 4. And that's just federal taxes.

The real reason we have a progressive income tax has nothing to do with fairness or any sort of ethics. It's simply due to the fact that only the rich have enough money to satisfy the ravenous federal government.

 

[Tom]

Originally posted by: CanOWorms

Originally posted by: Tom

Originally posted by: CanOWorms
It's interesting how one general group of people supports restricting financial liberty but not civil liberties, but the other group supports restricting civil liberties but not financial liberty. It's pretty sad to see what America has become when both of the largest groups represent evil.

I don't know what groups you are talking about, but in response let me say I don't see my Democratic party as restricting financial liberty, if that's what you're saying.

If you start from a position of wanting equal opportunity for everyone, which is fundamental to financial liberty, then society has certain obligations to establish a level playing field.

Also, the larger the universe where-in the financial liberty is going to happen, the more opportunity there will be, leads to decisions like electrification, building roads and dams, etc.

And we could make a society that's only goal was the immediate gratification of those that are now living, but that's pretty short sighted and stupid.

Any taxes is a restriction on financial liberty. A 30% income tax is a 30% reduction in your freedom. You're placing restrictions on someone supposedly for the benefit of the society as a whole, however it's no different than restricting civil liberties for the safety of the society as a whole. Both groups are essentially the same - they wish to take away from the individual.

Obviously a balance needs to be achieved, but I personally feel that taxes are too high for what little the government does.

A tax is not a restriction on financial liberty at all. That's like saying paying for food is a restriction of financial liberty.

You are confusing lack of ability with liberty. In our system, with taxes, you can get as rich as you are able. If you don't have enough money, it is your fault, not because you pay taxes.

The society we have, including the government and taxes, has created the greatest economi liberty for the most people of any sytem in history. And not just in our country, but in every country that has adopted it.

There are places in this world without functioning governments, they aren't pretty.

 

[fitzov]

Anyone can make up analogies like that--all supporting their own version of what's best for the tax system. Don't let the simplicity fool you.

 

[CanOWorms]

Originally posted by: Tom

A tax is not a restriction on financial liberty at all. That's like saying paying for food is a restriction of financial liberty.

That doesn't make any sense at all.

You are confusing lack of ability with liberty. In our system, with taxes, you can get as rich as you are able. If you don't have enough money, it is your fault, not because you pay taxes.

Sorry, I think we just have different viewpoints. I view any restriction imposed by the government to be a restriction on my freedom. Restrictions on speech, permits for protest, taxes, etc. are all restrictions to me. Obviously there has to be some, the question is to what extent.

The society we have, including the government and taxes, has created the greatest economi liberty for the most people of any sytem in history. And not just in our country, but in every country that has adopted it.

There are places in this world without functioning governments, they aren't pretty.

I don't see why we can't create a functioning government that is efficient and does the msot possible to give people the most control over their own rights and property balanced with the overall society's needs.

 

[pinion9]

Originally posted by: dullard

Originally posted by: ECUHITMAN
Second, if half the US population paid 5K a year that would equal: 750 Billion. I picked half because you can?t honestly expect children and old people to work.

750 billion is a bit short of the 2.4 trillion the US SPENDS per year. Even if you doubled it to 10K a year in tax we would be short by 1 trillion dollars.

No, children and elderly use government services too. Thus since he is after a true flat tax, they should pay it too. And bump it up to $8000/person. Then we'd hit the break-even point. $2.4 trillion in, $2.4 trillion out.

A family of five who is supporting one of their four grandparents then must pay $48000 per year in taxes. No deductions, no credits because we want it to be truely flat.

Oh wait, the median household income is ~$45,000 per year. That's ok, they can go into debt to pay the remaning $3000 of taxes. Wait, they have no money for housing, food, utilities, clothing, etc. No problem, they can move to another country.

Well, they we cut medicare/medicaid, welfare, SS....
People should make different choices with their lives. It isn't my fault the median is 45K a year. I know it isn't a reality, but I believe it is unfair that I pay more in taxes than my wife makes, yet we use the same services, etc.

I am at a point of diminishing returns. The more I work, the larger percentage they take. It makes it hardly worth it. It is no incentive to suceed when I know the craphead renter I used to have has 5 kids, doesn't work, smokes like a chimney, and my tax dollars pay for her to live. She is useless as a human being. She is no better than trash and should be treated as such.

 

[ECUHITMAN]

Originally posted by: dullard

Originally posted by: ECUHITMAN
Also, just so you know most people in this country do not pay 30% tax. According to the IRS as a single person you would have to make more than $150,000 per year to pay even 28% of your income.

If you would like to learn how federal taxes work:
http://www.irs.gov/pub/irs-pdf/i1040tt.pdf

Not really EcuHitman. Even a single person making $150,000 pays far less than 24% income tax (and this thread is clearly just about federal income tax like I said in my post above). At $150,000 taxible income, you will have paid $36,506.50 in taxes. That is 24.3%. And someone like that has deductions and credits, so that 24.3% is really too high. Using that logic, the single person who ignores deductions and credits needs a yearly income of $303,000 to pay 30% income taxes.

Yes. That is true. I guess I was thinking bracket not actual %. Even forgetting the credits and deductions just raw tax you pay 28% of the amount over $71,950 which is something that most of these people that complain about tax forget.