Tax Rates in the United States

[RickAJ]

I'm just curious about where most of you stand. I agree with a flat-tax rate, and a decrease in the corporate tax. Government should reform the tax code and stop showing favouritism to certain corporations and companies.

[Sphere]

At this point federal tax levels have nowhere to go but up. We are well below even Reagan levels.

As to a flat tax, there is a reason why the vast majority of western nations use a progressive tax system; it doesn't make sense to place more tax burden on the middle and lower classes.

[Nietzsche]

At this point federal tax levels have nowhere to go but up. We are well below even Reagan levels.

As to a flat tax, there is a reason why the vast majority of western nations use a progressive tax system; it doesn't make sense to place more tax burden on the middle and lower classes.

I'm sorry, but that graph does not make sense with your statement. Revenue is "below even Reagan levels" because of the depression not because of tax structure.

Can you source that graph please. The BEA's site is horrible and I couldn't find it.

[Pickle_mole]

This train of thought assumes that wealth is stagnate, what if this flat tax allows more growth in turn giving more wealth the middle and lower classes.

[Dr. Croccer]

This train of thought assumes that wealth is stagnate, what if this flat tax allows more growth in turn giving more wealth the middle and lower classes.

Because miracles don't happen. A flat tax rate in the US would mean the impoverishment of many millions of poor and tax revenue would drop dramatically as the bulk of absolute tax revenue comes from the rich, which will be taxed by a smaller rate in such a scenario. The lower and middle classes wouldn't benefit, because their tax rates would either remain largely stagnant or even increase (a flat tax rate would mean that progressive taxation, i.e. lower tax rate for the poor would be abandoned in favour of a random tax rate inbetween the lowest rate for the poor, and the highest rate for the rich). The only people who would benefit much from a flat tax rate in the US would be the upper classes, who already have had a gigantic increase in wealth over the last decades, and who, obviously, are already very wealthy.

[Sphere]

I'm sorry, but that graph does not make sense with your statement. Revenue is "below even Reagan levels" because of the depression not because of tax structure.

Its not a straight revenue graph, its shows federal revenue as a percent of GDP i.e. how much of the economy is the federal government skimming off. Under Reagan it was 16-18%, today its around 14.5%.

This train of thought assumes that wealth is stagnate, what if this flat tax allows more growth in turn giving more wealth the middle and lower classes

Thats if you buy into trickle down economics and I don't. I think the overall level of taxation is far more important to economic growth. I.e. if you are looking to promote growth cut tax levels, but keep it progressive so that someone making $7.50 an hour isn't paying 20% of their income to the feds.

[Admiral Piett]

I MIGHT support a revised progressive system, but our current progressive system is so vastly over complex and filled with intentional loopholes and skips for the upper and lower classes that all of the burden again falls upon the middle class. Probably more of a strain than even a just having a flat tax.

Although the FairTAX idea is also an interesting one, but there is still so little knowledge about how it would actually work. Putting more tax on consumption seems a pretty logical and legit method of revenue and it might prevent overconsumption and aggregated confidence. I was never a fan of bull markets.

[JP226]

Corproate taxes are more like charity than actual taxes anyhow.

[JP226]

A flat tax rate wouldn't change anything. Most states have flat rates and the tax bill is still giganticaly skewed to the tune of a few thousand paying as much as 80% of the tax. Our progressive system of taxation is incredibly undiversified and outdated.

[k995]

A flat tax rate wouldn't change anything. Most states have flat rates and the tax bill is still giganticaly skewed to the tune of a few thousand paying as much as 80% of the tax. Our progressive system of taxation is incredibly undiversified and outdated.

Its outdated because the gap between rich and poor is ever increasing .

As for a few thousabnds paying a lot: so what? If they have an esual amount of the income whats the problem?

[Dr. Croccer]

A flat tax rate wouldn't change anything. Most states have flat rates and the tax bill is still giganticaly skewed to the tune of a few thousand paying as much as 80% of the tax. Our progressive system of taxation is incredibly undiversified and outdated.

No, it's got to do with your gigantic income inequality. If the majority of absolute tax revenue in a state of several million people is paid by a few hundred thousand people then action should be taken to increase social mobility. It means that a few tens of thousands of people make more money than several million others. The object should be to stimulate those masses to achieve a more wealthy condition, and you don't do that with.

And there's another serious problem with such massive inequality, which you highlighted. A large part of your countries finances comes from a relatively small group of wealthy individuals and corporations. If they decided to leave, which they could, they could indeed easily destroy the economy of the country. That's a gigantic amount of power they have. A corporation or two could threaten that they want less taxation or more privileges or they will leave.

Lower taxes, less BS, its what the people want, overwhelmingly.

What?! People want low taxes?! What a novelty!

Flat tax =/= low tax. For the lower classes their tax rate would probably increase whilst it would remain stagnant for the the middle class. Which basically is like, 60-80% of the American population, who would get jackshit from a flat tax.

Rich hall kinda amused me on the topic of American polls. He stated that the polls were often undertaken in shopping malls and the people in it were the same people who would say that it's a good idea to have donuts the size of truckwheels.

[Bleda]

What?! People want low taxes?! What a novelty!

Flat tax =/= low tax. For the lower classes their tax rate would probably increase whilst it would remain stagnant for the the middle class. Which basically is like, 60-80% of the American population, who would get jackshit from a flat tax.

Like you can see past your nationalistic hatred of the US to begin with. I can't imagine you contributing to a thread that has anything even slightly to do with the US that isn't a string inflammatory, pejorative posts. All the while you know precisely squat about the culture in the US except what you are spoon fed by other haters.

[Dr. Croccer]

Like you can see past your nationalistic hatred of the US to begin with. I can't imagine you contributing to a thread that has anything even slightly to do with the US that isn't a string inflammatory, pejorative posts. All the while you know precisely squat about the culture in the US except what you are spoon fed by other haters.

Oh yes, my posts in this topic have been absolutely filled to the brim with fierce, rabid rage for the US. Not a shred of objective analysis at all. No siree. I've forgotten to mention that 98.9% of Americans are morbidly obese. And the rest are just plain fat. Republicans drink the menstrual blood of virgins and George Washington was a gaywad.

Now, if you will excuse me, I've got 5 flagburnings to attend to.

Death to America!

























































[None of the above was serious, by the way.]

[JP226]

As for a few thousabnds paying a lot: so what? If they have an esual amount of the income whats the problem?

We depend on 1000 payers for 80% of our corporate taxes here in Florida, and of those 1000, really it's about 300 that makeup 70% of that 80%. You know how screwed we'd be if say just 50 of those large companies decided to move on?

Infact, since the finance industry was hit so hard, that's essentially what's happened and we are fudged. We already have an extremely lean government and we have to find an extra billion dollars laying around that's just not there.

[Phier]

Just 23% of voters say they prefer a more active government with more services and higher taxes over one with fewer services and lower taxes. This finding has remained fairly consistent since regular tracking on this question began in November 2006.

Lower taxes, less BS, its what the people want, overwhelmingly.

[JP226]

No, it's got to do with your gigantic income inequality. If the majority of absolute tax revenue in a state of several million people is paid by a few hundred thousand people then action should be taken to increase social mobility. It means that a few tens of thousands of people make more money than several million others. The object should be to stimulate those masses to achieve a more wealthy condition, and you don't do that with.

Our taxable income bases are skewed but the actual amount of income isn't anywhere near as skewed as 2.7% of the population generating 80% of the income. We're not some god damned 3rd world country that ya'll happened to up a 100 years ago. What classifies as income and taxable income are two different things entirely.

Out of the gate you get a series of exemptions and deductions. Things like your mortgage, your healthcare, earned income are all taken from that lump sum that is calculated as your income. Works the same for companies. If you are an S corp, LLC or partnership, in many cases you aren't even taxed on income. If you are unlucky enough to be a C Corp and actually get taxed, you get an automatic exemption, at the state level it's typically 5 grand, ontop of that there are deductions for capital losses, operation losses, contributions, nonbusiness income. You get property tax deductions, you get renewable energy deductions, depreciation allowances, which after the nonbus inc and capital loss, by the depreciation allowance your getting triple counted for depreciation from your taxable income, although not directly. THEN you have the structure of your business. At the state level, portion of income that is determined to have been produced in a given state hinges on your make up of property, sales and payroll in that state versus nationally. States vary the weights of those three categories. Some states only charge taxes on income portioned according to sales. So if I was a smart company, I'd reconstruct my company makeup to be heavily involved in property and payroll in those states and get my sales predominatly elsewhere, and not have to pay tax. California actually went a hundred eprcent sales apportionment and los 2 or 3 hundred million in revenue. National and internationally you have the waters edge unitary apportionment which also causes problems in a similar vein(sp?) but it's a bit more complex than a weighted equation that the states use. After all that, you then get into credits. So they take your taxable income which is maybe 3/4ths of what your actual income is and they multiply it by the taxrates to provide this concise "tax due" and they start subtracting tax credits from it. Things like a couple grand for hiring a homelss person, who doesn't have to be homeless btw, child care credits, being located in a high crime area (which is relative, and not necessarily "high crime"), you get credits for investing in certain companies, you get credit for using things like biofuels. Many of the credits were already counted in the deductions. And when it's all said and done you have to make so much frickin money to even qualify as a tax payer that it's absurd. Then that's not necessarily true because I know plenty of ompanies that make lots of money and don't pay a single dime. Billions upon billions of income dollars are being ignored.

[Phier]

Coccer you forgot the LESS SERVICES part. Take less and return less. Its horribly difficult for a European to grasp, I'm sure.



This graph is why we have the issues we do today.

[JP226]

You could cut the tax rate and boost the payers, pull in more revenue and be business friendly all at the sametime.