Ten Principals of Tax

What was used before income of citizens of this country was taxed. Putting the federal government's revenue stream back to what it was just may help get the feds out of everything that wasn't intended by the Constitution and Bill of Rights.

Since that won't happen, my choice is the flat tax. Rate too high in the example, IMO. Speculating that it should be somewhere between 5% & 10% max.

Individuals - Flat tax on gross income over x annual amount per person/family. No exemptions, no deductions, no nothing.

Corporate - Flat tax on gross profit (sales minus cost of goods & incoming freight). No exemptions, no deductions, no incentives, no nothing.

No individual tax returns, except in situations where a refund is due or tax was not deducted by the source of income. (Tax not deducted on tips, for example.)

Set up as a constitutional amendment. Once established the tax rate cannot be changed without further amendment to the original amendment. Only exception would possibly be a declared act of war. Both the % increase and limitations on duration to be included in the original amendment.

An amendment BTW that requires a balanced federal budget for every fiscal year. Not one red cent of money can be spent in a new fiscal year if an approved budget is not in place on day 1.

Salty, probably alot more "opinion" than what you wanted. :type: :smilewinkgrin:

 

Glad you reminded me. :smilewinkgrin:

AT @ 5% deducted for each deposit. Are you sure there will be no need for any paperwork because there will be no refunds?

* Put $100 in the bank & 5% deducted. Withdraw $100 to buy a widget. Get the widget on sale for $75. Include the $25 saved in my next deposit of $100. Another 5% gets deducted. So, I'm paying taxes on my $25 twice.

* Put $50,000 in bank and pay 5% in taxes. Withdraw $50,000 to invest in gold. Hold for 2 years, sell. Put $75,000 (cost + profit) in the bank. Pay 5% in taxes on $75,000. Paying tax twice on $50,000.

* Save $100,000 over 10 years. Pay 5% on each deposit. Withdraw $100,000 to pay for a house. Live in the house 5 years and sell for $100,000 that's deposited in the bank. Pay 5% on deposit. Paying tax twice on $100,000.

* Wrecked my truck. Insurance company paid $500 to cover repairs. Deposited check, till repairs are complete. Pay 5% tax on deposit. Paid premium with dollars taxed at 5%. If reinbursement for damage, med insurance, etc. is considered to be income, refund due for taxes paid on premium monies. If reinbursement for damages, etc. is not income, refund due for auto deduction of 5% at time of deposit.

* Holding a retirement plan with combo of tax paid contributions plus earnings. Withdraw from plan x amounts over 10 years. Deposits taxed at 5%. Paying tax twice on portion previously taxed.

These are a few examples that come to mind. No refunds? No paperwork?

 

So, I can't use direct deposit on anything that may have the potential for double taxation?

** Pay my bills on line. Error found for overcharge. Funds electronically returned to my account. Taxed twice?

** If I withdraw funds on a monthly basis from an retirement account that holds both after tax and pre-tax dollars, I must go through conversion to "green cash" of the portion that has previously been taxed?

 

I'm all for leaving it alone... Look how many accountants, tax preparers, tax lawyers, software coders, etc would be out of work if we changed it. Not to mention how could we hide (un)legislated abuse if we couldn't modify the tax code to reward/punish those that do/neglect to do our bidding?
All this flat tax talk is going to cause unemployment!