Flat Tax

El Shaddai · 04-23-2003, 06:44 AM

Just finished reading an interesting article regarding tax reform in Russia. Two years ago they dumped their western style progressive tax for a flat 13% tax.

Tax revenues increased by 30%.

Things that make you go hmmmm........

The Fishing Geek · 04-23-2003, 06:50 AM

Tease. Cough up the article.

El Shaddai · 04-23-2003, 07:14 AM

www.forbes.com/2002/1209/038.html

I had to type this because I couldn't copy the link?!?!

El Shaddai · 04-23-2003, 07:16 AM

Let's try this again.......

www.forbes.com/forbes/2002/1209/038.html

The Fishing Geek · 04-23-2003, 07:30 AM

Who pays less than 13% Federal tax? Just curious.

Cool Texan · 04-23-2003, 07:48 AM

Tax laws are easy to criticize, difficult to draft. Progressive taxes arent a bad thing....what is potentially bad, in a non revenue producing sense for the gub'ment, are the loopholes which enable you to shelter earnings.

Russia could have very easily clamped it down by saying "13% on everything you have that is above what you had yesterday, no matter where or what it is". Problem is, just look at their economy.

I say stick with the progressive tax structure, but draft the rules to be equal and fair, accounting for loopholes which are only available for the upper crust folks, etc. Then you have equity. Till then, give up on it...there will always be loopholes.

The Fishing Geek · 04-23-2003, 07:50 AM

"Equal", "fair", and "equity" are very subjective terms.

foxer · 04-23-2003, 07:56 AM

There are many people around here that support a "flat tax". I still think that a sales tax would work if the property taxes were slashed, liek Washington.

El Shaddai · 04-23-2003, 07:58 AM

TFG- Yes they are......

I see the IRS just requested an additional 30,000 agents to enforce tax code changes enacted over the past three years. Besides the subjective equity issue, the administration costs are unreal...talk about waste.

CT- Loopholes do exist. However, they are relatively insignificant in relation to the whole. I know many individuals in the upper tax brackets that are cutting extremely large checks to the government every quarter; despite the famed loopholes, Uncle Sam gets his cut from just about everybody.

El Shaddai · 04-23-2003, 08:00 AM

Interestingly enough, most states have a variation of a flat tax structure.

pdxkevin · 04-23-2003, 08:34 AM

A flat tax system would be great but there is no way that the mega-accounting firms would ever let it pass. They are out of business if it goes through so they will throw a ton of money into buying legislators and then lawyers.

Not to meantion all the gov workers who's sole function is manipulating the taxes collected, not collected, and working on ways to take more.

TheRogue · 04-23-2003, 09:51 AM

Quote:

CT- Loopholes do exist. However, they are relatively insignificant in relation to the whole. I know many individuals in the upper tax brackets that are cutting extremely large checks to the government every quarter; despite the famed loopholes, Uncle Sam gets his cut from just about everybody.

<font size="2" face="verdana,arial,helvetica">Yeah, what about the state structure?? A large corporation like PGE only pays $10 in state tax, on net revenues of $64 million??

MSNBC

More information...

A little more...

TR

El Shaddai · 04-23-2003, 12:40 PM

pdxkevin- You are dead on........

As for PGE not paying taxes, there is much more to the story. I am not a PGE owner or a PGE fan, but I know the reasons behind tax breaks for some large corporations.

Companies like Intel are basically recruited by cities for expansion. The premise being that the jobs they create (thus increasing the tax base) will outweigh the loss of corporate tax revenue.
While this does happen, it is but a drop in the bucket compared to what most companies pay.

The Fishing Geek · 04-23-2003, 12:45 PM

Property taxes can be manipulated easily. Just look at Measure 5.

Sales taxes are too economy-driven. When the economy dips and people aren't buying as much, your state hurts.

Cool Texan · 04-23-2003, 02:18 PM

Are we trying to solve anything here, or just discuss?

Either way, I'm staying on the loophole wagon. Its how the game works.

1pump · 04-23-2003, 08:58 PM

Forbes.com, huh? Anybody remember when Steve Forbes made his half-hearted run for President on the Flat Tax platform? And I'm sure that the fact is that he's one of the richest Americans doesn't have anything to do with it. Naaaaah....

I was talking to a guy today who is a proponent of a national sales tax which would eliminate the federal income tax.
Like that would ever happen.

Bigdog · 04-23-2003, 11:31 PM

I'd support a sales tax if you do away completly with property taxes.

TheRogue · 04-23-2003, 11:39 PM

Property tax is the only almost absolutely reliable means of taxation. Property doesn't go away, someone always owns it. To do away with it completely doesn't make any sense.

I do feel that property taxes should be directed almost exclusively to education funding.

TR

BTW, notice that PGE paid almost no property tax, either.

Bigdog · 04-23-2003, 11:59 PM

Ok, then do away with income tax completely. At least with a sales tax everyone pays, tourist ect... I will not support three different taxes for the goverment to raise. (income, property, sales.) you have to do away with one for me to vote for the other.

Silver Hilton · 04-24-2003, 09:10 PM

Well, that was certainly an indepth coverage of the issue...

As well as an objective source. Not.

Discussion of the Russian tax collection rate is a bit out of context unless you consider the issues in their government and country that effect past collection. They also continue to try to improve the rule of law in their country. The biggest problem with russian tax collection is that such a large part of the economy is underground. Concurrent with this tax change, they are continuously trying to imrpove their tax collection administration. Is it just possible that improved enforcement improved collections?

Their increases in tax gains certainly have not come from a booming economy that the tax cut stimulated, as the country is still largely stagnant and corrupt, by our standards. So, an increase of reveneues can only have come from people finally starting to pay taxes on previously undeclared income.

If that is the case here in the states, well, I hardly feel that it is appropriate for us to reward criminals for evading taxes by reducing their rates. The appropriate social approach is prosecution.

However, I would easily agree that the current tax code is in desparate need of re-simplification, much as happened in 1986 (?).

I don't see the need or value for a flat tax, even though the rate you propose would save me a bunch of money. The issue is, if I save a bunch of money, someone else has to pay more. Are you willing to gamble it isn't you?

STGRule · 04-24-2003, 09:18 PM

SH: Hate to butt in, how was fishing? Is it worth the tide?

[ 04-24-2003, 10:19 PM: Message edited by: STGRule ]

monoman · 04-24-2003, 09:19 PM

Flat tax rates would have to be very close to the mid to upper end rates now, to collect the same amount. These rates would have to be in the 30% range plus. Tell me who in DC will vote for a flat rate of 30%.