NationStates Jolt Archive

How high should taxes be, or if there should be any at all?

EDIT: This is for a consumption tax, such as a user fee for roads and such as Melkor States.

How high should taxes be, or if there should be any at all?
When the rich cease to grumble and accept their lot.

enough for the government to have a big budget and savings of course

It depends on the type of tax. Income tax and consumer goods tax aren't the same. And it also depends on how much public services your government wants to offer.

All in all, I believe all taxes put together should never total more than 50% of citizen's income.

They should be charged at a flat rate, and must be only as much as the government needs for basic functions. Those functions should be defense, law enforcement, the courts, roads, a post office, and paying off the national debt.

No taxes at all!

Skaladora is right, it largely depends on what kind of tax we're talking about. A Gas Tax, for example, is more or less a user fee for our roadway, so that one makes sense, in a way. Income tax on the other hand, should not exist. If it does, any further taxation on any transaction [or, hell, even death] would constitute double taxation.

As high as I was when I loved you, baby.

Skaladora is right, it largely depends on what kind of tax we're talking about. A Gas Tax, for example, is more or less a user fee for our roadway, so that one makes sense, in a way. Income tax on the other hand, should not exist. If it does, any further taxation on any transaction [or, hell, even death] would constitute double taxation.

Actually, Income tax is superior to any other form of taxation. Gas tax, or consumer goods tax, tend to be disadvantageous for people with lower income, because they use all their annual income in consumer goods, food, oil, etc. while richer folks tend to buy stock options, accumulate savings, and that would not be taxed. So on an absolute level, poorer poeple get taxed more proportionately to their income than richer folks.

The ideal taxation system is a flat income tax rate, say 30-40%. With such a system, everybody get taxed the same (proportionate to their income, of course).

They should be charged at a flat rate, and must be only as much as the government needs for basic functions. Those functions should be defense, law enforcement, the courts, roads, a post office, and paying off the national debt.
And companies would handle education, healthcare etc?

And companies would handle education, healthcare etc?

No, private individuals would.

Actually, Income tax is superior to any other form of taxation. Gas tax, or consumer goods tax, tend to be disadvantageous for people with lower income, because they use all their annual income in consumer goods, food, oil, etc. while richer folks tend to buy stock options, accumulate savings, and that would not be taxed. So on an absolute level, poorer poeple get taxed more proportionately to their income than richer folks.

The ideal taxation system is a flat income tax rate, say 30-40%. With such a system, everybody get taxed the same (proportionate to their income, of course).

Your flat tax is better than the current system (in usa)
But I think that a consumer goods tax would be best; with exemptions for necessities.
Most of the money the poor spends is on necessities; the rich are the ones that buy the most luxuries. Of course this would lead to many debates about what is and is not a necessity.

Enough to keep a SMALL budget out of debt and a small savings.

Most of the money the poor spends is on necessities; the rich are the ones that buy the most luxuries. Of course this would lead to many debates about what is and is not a necessity.

Which is why I generally argue that a flat income tax is both simpler and more efficient.

It would also insure that the rich and the corporations pay their taxes; here in Canada the income tax system is so fraught with exemptions and ways to get around the legislation that in the top 200 companies, 50 don't even pay 1000$ in taxes each year. My mother pays about 15 000, and if I didn't get my taxes back at the end of the year(because I'm a full time student), I would be paying something around 1000$.

I think everybody agrees that a multibillion dollar company should pay more taxes than a student with a part-time job... :rolleyes:

I think everybody agrees that a multibillion dollar company should pay more taxes than a student with a part-time job... :rolleyes:

I disagree. No one should pay income taxes.

But I think that a consumer goods tax would be best; with exemptions for necessities.

A consumer goods tax, that is not charged on necessities, is no differant than a progressive income tax in effect.

I disagree. No one should pay income taxes.

Well, then if you disagree I have to say I fiend your viewpoint... disturbing.

Which is why I generally argue that a flat income tax is both simpler and more efficient.

It would also insure that the rich and the corporations pay teir taxes; here in Canada the income tax system is so fraught with exemptions and ways to get around the legislation that in the top 200 companies, 50 don't even pay 1000$ in taxes each year. My mother pays about 15 000, and if I didn't get my taxes back at the end of the year(because I'm a full time student), I would be paying something around 1000$.

I think everybody agrees that a multibillion dollar company should pay more taxes than a student with a part-time job...

Those are arguments against the structure of the tax code. You can have a simple progressive tax with little to no exceptions.

Also note the point isn't that, despite the flat rate, the corporation is paying more in gross than the poor student.

The wealthy, after taxation, have enough for necessities, luxuries, and investment. The poor can pretty much just cover necessities. If you tax the wealthy person at a higher rate than the poor person then the wealthy person will, of course, lose more money than the poor person would save.

However, the wealthy person can still afford necessities, luxuries, and investment (though to a lesser degree). The poor person, even by saving the most seemingly insignificant amount of money, would gain quite a bit for having it.

Stating it more complexly, there is a differance in the utility of money and it isn't unreasonable to tax according to the different untility.

Of course the tax should never be oppressive, I would think the upper bound should be around 50% and only for those who have a very high income.

Those are arguments against the structure of the tax code. You can have a simple progressive tax with little to no exceptions.

Also note the point isn't that, despite the flat rate, the corporation is paying more in gross than the poor student.

The wealthy, after taxation, have enough for necessities, luxuries, and investment. The poor can pretty much just cover necessities. If you tax the wealthy person at a higher rate than the poor person then the wealthy person will, of course, lose more money than the poor person would save.

However, the wealthy person can still afford necessities, luxuries, and investment (though to a lesser degree). The poor person, even by saving the most seemingly insignificant amount of money, would gain quite a bit for having it.

Stating it more complexly, there is a differance in the utility of money and it isn't unreasonable to tax according to the different untility.

Of course the tax should never be oppressive, I would think the upper bound should be around 50% and only for those who have a very high income.

My main opposition around the progressive tax system is that it is usually designed(at least here in Canada it is) to make it look like the rich and the corporation are paying more taxes than poorer folk, whilst in reality they aren't. There are so many ways for them to get around paying their taxes, that I'd rather have a flat 33% for everyone. It saves up a lot of headache when trying to find out how much everybody should pay.

If you won 30 000$, then you pay 10 000. If you won 3M$, then you pay 1M$.

Of course, I'm not opposed to a semi-progressive system where the lower tier(read: really low-income tax-payers) gets exemptions. Just that, once a certain income floor has been reached, everybody should be taxed in equal proportions for simplicity's sake.

It would be a real imporvement on Canada's so-called "progressive taxation". Progressive income tax is much like communism: sounds great on paper, bu virtually impossible to get right.

As high as necessary. :rolleyes:

Skaladora,

I would also agree that such a deceptive tax code is quite harmful.

However, a progressive tax isn't much more complicated than a flat tax, even one with multiple tiers. The real complications, as you have mentioned, are politicians attempts to add 'fairness' or encourage spending behavior.

It doesn't seem you are opposed to progressive tax on principle, just the modern inefficiency of government in applying it. And I think we can all agree that no matter what the government does it should, at the very least, strive to do so in an efficient manner.

user fees are taxes on the poor.



it depends for whom?

tax the rich

trickle down is a delusion.
the robber barrons never went away,
they just invented p.r. (which hitler was very fond
of the new US invention, btw)



a progressive income tax based on ability to pay,
is a much more fair & balanced way to pay for
public goods such as sewer systems, roads, libraries,
schools, museums, water works, etc...

you benefit the most by the way we structure society, you pay the most.

Taxes are a communist type of thing, so lets abolish them.

A major problem with progressive tax codes, at least the tax code in America, is that taxes only get higher when you get more from a paycheck. The super rich often make most of their money from things like capital gains -not a salary.

user fees are taxes on the poor.



it depends for whom?

tax the rich

trickle down is a delusion.
the robber barrons never went away,
they just invented p.r. (which hitler was very fond
of the new US invention, btw)



a progressive income tax based on ability to pay,
is a much more fair & balanced way to pay for
public goods such as sewer systems, roads, libraries,
schools, museums, water works, etc...

you benefit the most by the way we structure society, you pay the most.
Not real up on the way things really work, are you?
If tricle down is a delusion, then why are federal tax revenues up (in the US) compared to pre-tax cut days?

Flat tax is the way to go it would seem. Russia has seen an increase in it's government revenus of about 20% each year for the past 3 years, all from switching to a flat tax rate.

Flat tax is the way to go it would seem. Russia has seen an increase in it's government revenus of about 20% each year for the past 3 years, all from switching to a flat tax rate.

Is that taking into account the growth in the Russian economy as well? Or any changes in its tax structure and enforcement (excepting of course the switch to the flat rate)?

If tricle down is a delusion, then why are federal tax revenues up (in the US) compared to pre-tax cut days?

I don't understand what you mean. Trickle-down is about the savings the wealthy receive in tax cuts benefiting the poor through a more vigorous economy. It has nothing to do with government revenues.

Before anyone can start talking about how much to tax, it should be established what to tax. The primary way upper income business personnel circumvent tax laws is with the expense account. Rather than counting that as income for the person, it's considered a business expense and businesses just write it off as such, which they could not do with a salary.

American Income Tax:
* 10%: from $0 to $7,150
* 15%: from $7,151 to $29,050
* 25%: from $29,051 to $70,350
* 28%: from $70,351 to $146,750
* 33%: from $146,751 to $319,100
* 35%: $319,101 and above

Serapindal Income Tax:

* 18%: from $0 to $10,000
* 21%: from $10,000 to $30,000
* 24%: from $30,000 to $75,000
* 27%: from $75,000 to $150,000
* 30%: from $150,000 to $325,000
* 33%: from $325,000 to $1,000,000
* 40%: from $1,000,000 and above

I disagree. No one should pay income taxes.
No company pays income taxes. They pay corporate taxes.

I think that taxes should be around the 50% mark at the top rate and 20% at the lower rate to pay for public services, defense etc. and to ensure justice and civil rights.

I would keep corporate tax low, like 14% in order to attract foreign investment. (I live in a small country, you see.)

This idea is not very different from the current tax regime in Ireland. The rates are marginally higher than in reality, but that's because I am sick of hearing about underfunded schools.

user fees are taxes on the poor.

No, they are not (only). The "rich" don't spend their money on investments, they invest to get more money. To get any good from their money they must spend their money, and when they spend their money they buy consumer goods just like the "poor". Lets take two examples. In both of them we use a 25% sales tax.

Poor
Income: 100
Spends: 100
Tax: 25% of 100 = 25
Total tax as percentage of income: 25/100 = 25%

Rich
Income: 10 000
Consumes:1000
Tax: 25% of 1000 = 250
Invests: 9000
Return on investment (assume 10% interest): 10% of 9000 = 900
Spends after investment: 9900
Tax on latest spending: 25% of 9900 = 2475
Total income: 10 000 + 900 = 10 900
Total tax: 250 + 2475 = 2725
As percentage of total income: 2 725/10 900 = 25%

As you can see the "rich" and the "poor" guy has very different investment habits, more so than I guess is realistic. But they both end up paying the same percentage of their income in tax. So a sales tax is a truly flat tax (Yes, it does hold for any numbers. Check for yourself.)

Is this a good thing? I have no idea. A supply side economist would say that it is bad. The poor should in his opinion pay more tax, because the investments of the rich help them both, while the poor does nothing to help anyone but himself. Personally I dislike sales taxes less than other tax systems because they do not, punish those who work, and IMO anyone who supports himself today deserves all the kudos he can get and not to be punished.

As high as necessary. :rolleyes:
That is no answer. You can always increase government spending, and the year after you will "need" the higher amount. It is a little bit harder to decrease the amount "needed", but that is not impossible either. Basically you always need just a little more than you have. That applies both to states and people.

The best idea/alternative I've heard so far is the Fair Tax (face it folks, that number isn't heading toward the zero mark anytime soon).

I believe the government should drastically reexamine our current tax system, and fix its flaws ASAP. We could all benefit from this in the USA.

A Flat rate of Tax between 20% and 30% is the best as it is fair to everyone, this includes business and money earned from investments etc. The tax would not have to be as high as a progressive system for the same level of services as a flat rate is a lot cheaper to run. Also as it is simpler it also makes it harder to evade tax so it is fair in this way as well

If you want to make it more progressive so that the rich pay more then you give everyone a fixed tax allowance (e.g. first £10000 earned is tax free) that is big enough that people on the lowest income pays very little tax.

This discussion about tax is going on in Britain at the moment with people proposing the first £10,000 earned being tax free and then a flat rate of about 20% for the rest of income earned.

If you really are insisent on a more complicated system then I believe the tax burden should never be more than 50% of a persons total income. I also believe that inheritance tax is morally wrong as a persons estate has alraedy been taxed during their lifetime and so in my view is just theft by government.