would no tax on individuals be the best for the economy?

[Gelgoog]

I've got a few co-workers at work with this theory, one of which used to work in finances and gave out high profile high risk loans. anyways he claims that if you take away all taxes on the individual that our economy would be incredible. he goes by the fact that a dollar spent in the economy is worth 10 times more then that given to the government ( mainly because the government is extremely wasteful and give away and spends a ton out of country). Now this would only be individuals, and businesses would either keep their current tax rate or be raised a bit.

now a better economy means more money that can be taxed through businesses so they govt will still make quite a bit of money. remember american spending prowess always dictates the route of the economy.

[kev-o]

When you say no tax on individuals are you talking like income tax?

[Ummagumma]

Now this would only be individuals, and businesses would either keep their current tax rate or be raised a bit.

Your government would still have to cover it's (as you say, wasteful) costs. The only way to do that would be to replace the tax from individuals with one from companies. The only way for companies to compensate for this higher taxation would be to lower wages. I don't know how the tax system works in the US, but here as you earn more you step into higher % tax brackets, so those that earn the most pay the highest proportion.
If 'individual' taxes were cut, the concept of tax burden would be destroyed, so those at the lower end of the pay scale would have lower wages to cover the extra tax costs of the company, while you can be sure that those at the top would still take massive amounts - which has now become totally tax free. The division of tax burden would be arbitrarily decided by individual companies rather than an equal system.
The only way to lower tax is to dismantle the government.

[GrnEyedDvl]

Your government would still have to cover it's (as you say, wasteful) costs. The only way to do that would be to replace the tax from individuals with one from companies. The only way for companies to compensate for this higher taxation would be to lower wages.

Or raise prices. Same net effect, different method.

I don't know how the tax system works in the US, but here as you earn more you step into higher % tax brackets, so those that earn the most pay the highest proportion.

Basically the same here, a few loopholes and lawyers aside.

If 'individual' taxes were cut, the concept of tax burden would be destroyed, so those at the lower end of the pay scale would have lower wages to cover the extra tax costs of the company, while you can be sure that those at the top would still take massive amounts - which has now become totally tax free. The division of tax burden would be arbitrarily decided by individual companies rather than an equal system.
The only way to lower tax is to dismantle the government.

Blatantly false. The problem with a graded tax system is that its basically redistributing money, the government version of Robin Hood.

Everyone should be treated the same regardless of income bracket. Such as a flat tax or a national sales tax.

With the current system what happens is that if you earn under 32000 with a family of 4, your tax level goes down even farther than the standard grading system, in 3 stages. In some cases down to no taxes at all. I think those were the 2006 numbers for the Earned Income Tax Credit.
http://en.wikipedia.org/wiki/Earned_income_tax_credit

But if you earn 50000 with a family of 4, your (income) taxes generally end up being around 2-4000 annually. Note that all this depends on 137423452524 other credits that can be claimed such as interest on house payments and flex feul vehicles and everything else under the sun.

For now lets take those numbers. If you are earning the 32000 with a family of 4, you can qualify for stuff like foodstamps and medicare and WIC and all kinds of programs. I just looked on the GovernmentGrants website, and foodstamp benefits are $250-500 a month. I will post the link farther in the post because there is some other interesting stuff there too.

So lets say $300 a month, x 12 months = $3600. Which is about the annual tax bill for someone earning $50,000. So basically you just took every dime that someone earning 50k paid in taxes and gave it to someone else that earned less. The government didnt use it for anything that government is designed for, but its even worse. Because the government had some overhead in moving that money, it actually costs the government money to administer that program. Which means that a 2nd family earning 50k had part of their money used to send it.

http://www.governmentgrantsearch.com...FRdPagodkwQ-Ow

Other interesting programs advertised on this site;
instantly get $3100
get a 25000 check
free prescriptions
buy a BRAND NEW car

All that is on top of the other federal programs you think of when you hear the term welfare.

I have seen numbers that claim out of every $1000 dollars in the welfare system, only $1 actually makes it to a family, the rest is eaten up by the government overhead. Thats probably a little ridiculous, but I would bet its less than 25% that makes it to people.

The earned income tax credit (EITC) provides $31 billion in refundable tax credits to 19 million low-income families. The IRS estimates that $8.5 billion to $9.9 billion of this amount—nearly one-third—is wasted in overpayments.

Take that in for a second. $31 billion to 19 million familes. Thats 16k per family. Of course they dont get near that.

http://en.wikipedia.org/wiki/United_...federal_budget
In 2000, the entire federal budget was 1.8 trillion, and welfare spending was 434 billion, more than 25%. Divide that by the number of recipients and you get around $100,000 spent per person. Note that isnt how much each person gets, but how much they get added in with how much the government spent to get it all done.

And thats just ONE piece of the federal pie. Every government program is like that, from education to defense. $400 hammers, $1000 toilet seats, you name it.

Lower taxes always help the economy, the lower the better. But with a government that spends money with reckless abandon the only REAL solution to helping the economy and also lowering taxes is getting rid of government agencies. Otherwise they will just spend it anways, even if they dont have it.

Some examples of that.
http://www.heritage.org/Research/Budget/bg1840.cfm

A recent audit revealed that between 1997 and 2003, the Defense Department purchased and then left unused approximately 270,000 commercial airline tickets at a total cost of $100 million. Even worse, the Pentagon never bothered to get a refund for these fully refundable tickets. The GAO blamed a system that relied on department personnel to notify the travel office when purchased tickets went unused

The bridge to nowhere.
http://www.washingtonpost.com/wp-dyn...102001931.html

One of the Alaska bridges, dubbed the "Bridge to Nowhere" by its critics, would connect one small town to a tiny island. It received $223 million in the highway bill that Congress passed this summer. The second bridge, named "Don Young's Way" in honor of its patron, House Transportation and Infrastructure Committee Chairman Don Young (R-Alaska), received about $230 million -- but that is just a down payment on a cost that could hit $1.5 billion.

These TWO bridges are designed to replace ferrys that run every 15 minutes, and cost $6 per car, to connect an island with a population of 50 to a town with a population of 8000. Total paid so far, 453 million divided by total population 8050 = $56,273 per person, or 9378 trips per person on the ferry. If you live on the island and work in the town, thats two trips a day, 5 times a week, or 520 trips a year.

All this and more needs to be discussed in any serious talk about taxes.

[Ummagumma]

Blatantly false. The problem with a graded tax system is that its basically redistributing money, the government version of Robin Hood.

'False'? - only according to certain political ideologies (yes, I realise that to most of the Americans I have talked to about these things I am considered to be just an evil commie...).

Everyone should be treated the same regardless of income bracket. Such as a flat tax or a national sales tax.

As I say, in your opinion, maybe.

The fact remains that direct taxation will just be replaced with indirect taxation - and the socialist side of me disagrees the the implications of it.

[Eskali]

Your government would still have to cover it's (as you say, wasteful) costs. The only way to do that would be to replace the tax from individuals with one from companies. The only way for companies to compensate for this higher taxation would be to lower wages. I don't know how the tax system works in the US, but here as you earn more you step into higher % tax brackets, so those that earn the most pay the highest proportion.
If 'individual' taxes were cut, the concept of tax burden would be destroyed, so those at the lower end of the pay scale would have lower wages to cover the extra tax costs of the company, while you can be sure that those at the top would still take massive amounts - which has now become totally tax free. The division of tax burden would be arbitrarily decided by individual companies rather than an equal system.
The only way to lower tax is to dismantle the government.

Yes, that is what i reckon

[LoZz]

its a nice dream, but individuals need to be taxed, but unless you want to ruin the economy by putting all the tax on business you will see alot of people being fired and thus have no money. i guess in theory it could work but you would have to reduce government spending an awful lot. no large military, etc etc.

[Big War Bird]

THe US Tax system is FUBAR. It cost somewhere around $350 to $500 billion dollars for americans to comply with the tax code. That not the taxes paid but expense of just figuring out how much everyone owes. The US tax code runs some 66,000 pages and in revised every year. It is so complicated that the IRS cannot enforce it. The IRS fails to collect some $300 billion do the difficult of figuring out who owes what.

[Ummagumma]

It cost somewhere around $350 to $500 billion dollars for americans to comply with the tax code. That not the taxes paid but expense of just figuring out how much everyone owes.

Is that for real? That can't be.. It's just, well.. so unlikely it must be true!

[Legionem Insanis]

It is so complicated that the IRS cannot enforce it. The IRS fails to collect some $300 billion do the difficult of figuring out who owes what.

Hope they don't miss what I'm going to "forget" to claim this year.

[Captain Blackadder]

Hope they don't miss what I'm going to "forget" to claim this year.

Well it is all a question of how much money you make since I believe if you are poor your chances of getting audited are like 50% higher then if you are wealthy.

Anyway taxes are a necessary evil unless we want to go full on socialism and go for the government controlling all industries which is the only way I could see taxes been abolished.

[Thanatos]

I'm fine with paying my taxes, I just don't like the income and property taxes, that's all.

[Big War Bird]

I'm fine with paying my taxes, I just don't like the income and property taxes, that's all.

Well that's a pretty good chunk of your taxes now isn't it?

[Kiljan Arslan]

source from a site that isn't freeloader (tax protestor) BWB?

[Big War Bird]

source from a site that isn't freeloader (tax protestor) BWB?

Not a tax protest site, the GAO, and I should correct my statements. I was writing from memory before.

The GAO estimate that complience cost run from $240 to $600 billion. (2% to 5% of GDP)
http://www.gao.gov/docdblite/summary...8&accno=A34598

The IRS estimates that they missed $312 Billion in 2001 according to The Economist.
http://www.economist.com/displaystor...ory_id=3860731.

Also the US Tax Code is 60,000 pages, not 66,000.

Income tax is ridiculous. I prefer to get my money in full even though government's social funding has to be reduced because I have trust in my own financial management skill.

Just who the hell do you think you are? Don't you know that the government thinks you are too stupid to do basic things like:
Save for your own retirement
Insure yourself against disability
Provide for your own medical needs
educate yourself
train for a job
find a job
buy food

The fact that you don't know these things tell me that you are an absolutely unfit to live in society. Please report to the nearest reeducation center.

[GrnEyedDvl]

Thats true, its actually probably more than that.

Think of all the BS you have to go through to file your personal taxes. Buy TurboTax at $50 a pop for every family in the country, and its probably 500 million.

And you dont even want to know what I pay my tax guy to figure out business taxes. Every dime of that is wasted money, that I could be using to do other stuff, if there was a simpler tax system.

[Ummagumma]

Thats true, its actually probably more than that.

Think of all the BS you have to go through to file your personal taxes. Buy TurboTax at $50 a pop for every family in the country, and its probably 500 million.

And you dont even want to know what I pay my tax guy to figure out business taxes. Every dime of that is wasted money, that I could be using to do other stuff, if there was a simpler tax system.

I thought it was a government expenditure figure.. Oops

You can't complain to much about paying for an accountant though - he's just another guy earning himself a crust after all. What would the cost be if you were to stop working (thus earning) and do the paperwork yourself?

[GrnEyedDvl]

What would the cost be if you were to stop working (thus earning) and do the paperwork yourself?

On a simpler system? Next to nothing. On this system its obviously cheaper for me to pay him than do it myself. That doesnt change the fact that its still a waste of money.

[Last Roman]

Thats true, its actually probably more than that.

Think of all the BS you have to go through to file your personal taxes. Buy TurboTax at $50 a pop for every family in the country, and its probably 500 million.

And you dont even want to know what I pay my tax guy to figure out business taxes. Every dime of that is wasted money, that I could be using to do other stuff, if there was a simpler tax system.

I'm not totally against income taxes, but a simpler tax system, I cannot agree more with you there.

flat tax ftw.

[jankren]

Income tax is ridiculous. I prefer to get my money in full even though government's social funding has to be reduced because I have trust in my own financial management skill.