This man is a nuts

[Rupert Pupkin]

Originally Posted by GenuineRisk

No, the biggest hurdle for the flat tax and national sales tax is that it will raise taxes on the poor and middle-class and lower them on the wealthy, and reduce them to zero for members of what a lawyer I know refers to as, 'The Lucky Sperm Club" (those people who inherit their wealth and don't work, but live off dividends). The EITC (Earned Income Tax Credit) is actually an incredibly effective program for lifting working families just above the poverty level (you have to be a working head of household, so teenagers and the unemployed can't qualify). From Wikipedia:

http://en.wikipedia.org/wiki/Earned_Income_Tax_Credit

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.