Single Payer

[MoValley John]

One of the craziest parts to me is that citizens are tasked with actually calculating it. The vast majority of people are calculating tax returns with the exact same information that is already available to the US government. We could just be like other countries and not require returns for the majority of people.

This is another example of a proposal that would likely cost the US government money (let's at least assume that it would cost some additional amount of money, but I'm not actually sure it would cost that much), but radically increase efficiency because you would not have hours and hours spent on taxes on both sides of the equation.

Can't be done due to the complexity of the tax code and infinite individual variables. I'd advocate for a flat tax or possibly but less favorably a vat tax tax, but the government isn't capable of calculating depreciation, expenses, deductions, so on and so forth, for nearly 330,000,000 people. Also, if you were one of the millions that had a simple return, would you trust the government to fairly calculate a refund? Not me.

[wufan]

Flag tax! I pay 20% of earnings above poverty level and you pay 20% of earnings above poverty level. What could be simpler?

[MoValley John]

Flag tax! I pay 20% of earnings above poverty level and you pay 20% of earnings above poverty level. What could be simpler?

Too simple. Too sensical.

[jdshock]

Can't be done due to the complexity of the tax code and infinite individual variables. I'd advocate for a flat tax or possibly but less favorably a vat tax tax, but the government isn't capable of calculating depreciation, expenses, deductions, so on and so forth, for nearly 330,000,000 people. Also, if you were one of the millions that had a simple return, would you trust the government to fairly calculate a refund? Not me.

I wasn't advocating for the government to handle the complex instances.

I'd think most would trust the government to deduct the correct amount, just like many other countries do. Just like we do on things like social security. If I were king, I'd create an opt out system for the folks like you who wanted extra piece of mind.

[jdshock]

Flag tax! I pay 20% of earnings above poverty level and you pay 20% of earnings above poverty level. What could be simpler?

Zero percent tax would be simpler. Since that's obviously not the only metric that makes a policy successful, you must also consider: 1. The effect such a policy would have on revenue and 2. If alternative wealth distribution policies would be enacted.

Anything can be made simple by reducing it to a single sentence: rich people should pay a greater percentage of their income in taxes. What could be simpler?

[wufan]

Zero percent tax would be simpler. Since that's obviously not the only metric that makes a policy successful, you must also consider: 1. The effect such a policy would have on revenue and 2. If alternative wealth distribution policies would be enacted.

Anything can be made simple by reducing it to a single sentence: rich people should pay a greater percentage of their income in taxes. What could be simpler?

While there are certainly consequences of flat tax that must be considered, it is self-evident that a flat tax is simpler than a progressive tax. By definition, a flat tax has one tax bracket. By definition a progressive tax has at least two. One is simpler than 2.

Now if you'd like to make an argument as to why a simpler tax bracket is not better than a more complex one, please proceed.

[jdshock]

Now if you'd like to make an argument as to why a simpler tax bracket is not better than a more complex one, please proceed.

If simpler is better, let's do zero percent tax rates.

You're the proponent. You should persuade why simpler is better and how to balance the decision making such that a 20% tax is better than the simpler zero percent.

[wufan]

If simpler is better, let's do zero percent tax rates.

You're the proponent. You should persuade why simpler is better and how to balance the decision making such that a 20% tax is better than the simpler zero percent.

I'm perfectly okay with zero income tax. We can do a consumption tax. I just felt that was a little more difficult to sell. You and I will need to get a few more folks on board, but I'm up for trying if you are!

[Aargh]

I'm adamantly opposed to a flat tax, but I could support wufan's 20% (or "something") above poverty level.

The reason I've been opposed to a flat tax is that every proposal I've seen has been a massive tax shift from incredibly high earners to low and lower middle class earners. I find it difficult to support government action that increases the rich getting richer and the poor getting poorer. We've already got that working effectively without government intervention.

Another problem I've seen with flat tax proposals is lobbyists and special interest groups getting many of their "needs" included in flat tax proposals. A lot of "supporters" of a flat tax will shift immediately to opponents the moment they see their pet exemption, tax credit, or other tax advantage disappear.

I think I'd recommend a rather generous definition of "poverty level" in wufan's idea. Give people an opportunity to join the bottom end of the middle class. Those people will spend that money, which is probably better for the nation overall than taxing it.

[MoValley John]

I wasn't advocating for the government to handle the complex instances.

I'd think most would trust the government to deduct the correct amount, just like many other countries do. Just like we do on things like social security. If I were king, I'd create an opt out system for the folks like you who wanted extra piece of mind.

I don't trust the government and I don't trust big business, either.

Too many government screwups close to home for me to trust them to do an honest job in that department. The government quit paying my wife's grandmother's ssn and military benefits, simply because they decided she was dead. No death certificate, no bank accounts closed, she simply turned 85 and they quit paying. It took three months before it was noticed, 18 months to fix, and two and a half years before the government made good. Meanwhile, my inlaws had to cover her finances.

Trust the government with taxes, no thank you.

[jdshock]

I'm perfectly okay with zero income tax. We can do a consumption tax. I just felt that was a little more difficult to sell. You and I will need to get a few more folks on board, but I'm up for trying if you are!

Haha... I apparently over played my hand.

My point is that a zero tax system is the simplest policy, but we clearly need tax revenue. I mostly want to know 1. why simple is important and 2. how important is it (e.g. Only taking in revenue is more important than a simple tax code).

[jdshock]

I'm adamantly opposed to a flat tax, but I could support wufan's 20% (or "something") above poverty level.

The reason I've been opposed to a flat tax is that every proposal I've seen has been a massive tax shift from incredibly high earners to low and lower middle class earners. I find it difficult to support government action that increases the rich getting richer and the poor getting poorer. We've already got that working effectively without government intervention.

How does his proposal resolve this concern for you? It still halves the marginal tax rate for the highest earners. His proposal almost certainly does all of the following:

1. Radically decreases revenue.
2. Radically increases the tax burden for those just above the poverty line.
3. Radically decreases the tax burden of high earners.
4. (Radically?) shifts the heaviest lifting for tax revenue toward the middle class on terms of where our tax revenue comes from.

[wufan]

How does his proposal resolve this concern for you? It still halves the marginal tax rate for the highest earners. His proposal almost certainly does all of the following:

1. Radically decreases revenue.
2. Radically increases the tax burden for those just above the poverty line.
3. Radically decreases the tax burden of high earners.
4. (Radically?) shifts the heaviest lifting for tax revenue toward the middle class on terms of where our tax revenue comes from.

1. If you remove exemptions, then revenue would not be radically reduced.
2. Not true. No one pays any taxes below the poverty line. If the poverty line is $10K, then no one pays any taxes below 10K. If the rate is 20% and you make 15k, then you get 10k free and pay a 20% tax on 5k (1k), for a net income of 14k. That's that's like a 7% income tax on your entire earnings. This structure would be better for the poor and middle class up to around 40k per year for a single person.
3. Probably not. Most high earners pay the Alternative minimum tax due to deductions. I think that's 24%. I'm not opposed to a flat tax of 24%, but used 20% for simplicity. Since all the wealthy are paying AMT anyway, they still pay the same amount.
4. Maybe. I'd have to work the numbers more, but it won't be lower middle class...possibly upper middle class.

[wufan]

Haha... I apparently over played my hand.

My point is that a zero tax system is the simplest policy, but we clearly need tax revenue. I mostly want to know 1. why simple is important and 2. how important is it (e.g. Only taking in revenue is more important than a simple tax code).

Simple is important to a libertarian because it shrinks the reach of the government. The IRS is no longer a major required service. It also provides fairness in that everyone pays the same percentage. Make more money, pay more money. It adds equity to socioeconomic class structures.

[jdshock]

Simple is important to a libertarian because it shrinks the reach of the government. The IRS is no longer a major required service. It also provides fairness in that everyone pays the same percentage. Make more money, pay more money. It adds equity to socioeconomic class structures.

In a really hyper-specific definition of the word "fair" where it means that "equal percentage of income over the poverty line." It cannot be a definition of fair that means

• Identical - since a person making $1,000 over poverty line would be paying a very different percentage of total income than someone making $400,000 per year.
• Equal impact - since, I hope, we can all agree that 20% of a dollar to someone struggling to make ends meet is a much bigger deal to someone than 20% of a dollar to someone making $400,000 per year.

"It adds equity to socioeconomic class structures" is a very misleading statement. If someone running on the platform of adding equity to socioeconomic class structures would seemingly be in favor of reducing class disparity. Your proposal reduces taxes on the rich.

You still haven't explained how important it is for it to be simple, though. Should I be willing to take a major cut in tax revenue to have a simple tax plan?