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Originally Posted by Rupert Pupkin
I think a combination of some type of flat tax and national sales tax could work.
Here is what my idea would be. We could have a national sales tax of around 5%. There would be no income tax for people in low tax brackets. So if you only make $30,000 a year, you would pay no income tax. The only tax you would pay would be the sales tax. So even if that person spent the entire $30,000 that they made, that means that they would only be paying a 5% tax on that. That's not too bad.
For people making $100,000 a year, you could make them pay a 10% flat income tax in addition to the 5% sales tax. For anyone who makes over $200,000 a year, you could give them a flat-tax of about 20%.
The most important thing would be to get rid of all of these tax right-offs. I've read some stories about some really rich people that pay practically no taxes because of all kinds of tax right-offs and tax shelters. We could have a flat-tax where you can't write anything off. If a person makes $1 million, they would have to pay $200,000(20%) in income tax and there would be no way to get around it.
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Sounds good to me. It also sounded good when Forbes used it as a policy platform a dozen or so years ago.
Problem is, the tax code is incredibly huge. How do you turn around a ship that big? I wish it would happen, but there's way too much top heavy interest group clout to let it happen. Besides the rich there are attorneys, accountants, banks, insurance companies, none of which would stand to benefit by massive tax reform.
It sounds great but unfortunately i think it's empty rehtoric.