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madbolter1
Big Wall climber
Denver, CO
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Jul 11, 2017 - 02:15pm PT
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What services get taken care of by revenue and which ones by savings?
I'm not making "assertions." I'm simply saying that these massive federal entities, such as the IRS, are unnecessary and that much money could be saved by eliminating them. There ARE ways to eliminate such entities, so why would we keep entities around that are oppressive and that cost us massive amounts of money?
Various alternative tax plans (such as a flat tax or sales tax) have been shown to be revenue-neutral or beneficial. So, if the new taxation plan is neutral, and you are thereby NOT funding an entity like the IRS, then you HAVE more money to spend than you did before. Spend that (whatever term you want to use for it) as you will, perhaps on roads. This isn't a complicated concept.
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Craig Fry
Trad climber
So Cal.
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Jul 11, 2017 - 02:29pm PT
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SPUNK = pyro
same insulting demeanor
trying to slither back in to ST
Is America Great Now?
Did Trump get rid of all those brown skins hogging the surf yet?
No, he hasn't done jack shit
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healyje
Trad climber
Portland, Oregon
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Jul 11, 2017 - 02:38pm PT
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MB1 ..... Thanks for being SPOT ON.
Actually, that was pretty much a mindlessly dogmatic tract of nonsense, particularly from someone who should be able to make a rough educated guess at what the administrative burden on our healthcare system is of varying state regulations not to mention hundreds of duplicate insurance systems, workforces and payrolls. It's easily trillions of dollars annually which provide zero, zip, nada and did I say no value of any kind whatsoever.
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TLP
climber
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Jul 11, 2017 - 02:39pm PT
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Some thread drift here but the title of the OP invites it. MB, agreement from this direction that it would be desirable to reduce the tax complexities, but reducing from 3 or 4 brackets to just one isn't the issue, it's the incredible amount of complexities and loopholes. How do these come about? Essentially, and nearly totally, from lobbying by business and individuals with a ton of money to spend hiring lobbyists and buying politicians. Including Intuit and the CPA industry. There's no lobbyist in Washington representing people in the <$20K income category, demanding a more complex tax form. So, focus on the source of the problem and how the currently established money-rules-absolutely political system perpetuates it. Fix that, and it becomes feasible to solve all these other things too.
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Cragar
climber
MSLA - MT
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Jul 11, 2017 - 02:54pm PT
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There ARE ways to eliminate such entities, so why would we keep entities around that are oppressive and that cost us massive amounts of money?
Like the way the combander in chief has set up the EPA? Or? Some things cost money to defend or to keep in service.
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Gary
Social climber
Desolation Basin, Calif.
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Jul 11, 2017 - 03:21pm PT
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I answered this already. If we went to a flat-tax or, better yet, a federal sales tax
In effect, a tax cut for the rich and a tax increase for the working poor.
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Craig Fry
Trad climber
So Cal.
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Jul 11, 2017 - 03:38pm PT
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1) We are not a small, mostly homogeneous, population with a long history of monarchy and being sheep. What you can get to work in a commune of 50 people is NOT what you can get to work in a nation of 30-million. And what you can get to work in a nation of 30-million is NOT what you can get to work in a nation of 330-million. Things just don't "scale" well, so large-scale "socialism" MUST become totalitarian to "work" beyond a certain scale. Now, many of you seem quite content to accept "some" measure of totalitarianism, if it "works." I am not!
2) You are going to get invasive governmental involvement in any sort of "healthcare reform." YOU seem to want that invasion to be personal. I prefer to keep it corporate. It's going to be largely one or the other. Either government is going to do what its actual legitimate role is: Regulate COMMERCE, including "price-fixing" as needed to ensure no-gouging, which presumes that government actually answers to US rather than lobbyists (novel thought). Or, government is going to regulate US via such invasive measures as are already implemented in other nations. Again, you seem content with such invasions. I am not!
MB1
complete BS confirmed with one simple word;
Medicare
We already have socialized Healthcare here and people love it
and more people want it
Who isn't going to take Medicare and let it pay for your healthcare needs?
and all true conservatives want it as well
because it saves money, it is fiscally conservative
so if you don't want it, you are obviously easily manipulated and want them to charge you more because of the private insurers' lobbyist efforts have worked
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madbolter1
Big Wall climber
Denver, CO
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Jul 11, 2017 - 03:53pm PT
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I'm not "blustering."
You eliminate "loopholes" and shut down lobbyists BY simplifying the tax code: move toward a flat-tax or, much better, a federal sales tax.
Taxes are then collected at POS, and the only "loopholes" are that (as is already handled trivially by POS machines) tax exemptions for food items and so forth.
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healyje
Trad climber
Portland, Oregon
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Jul 11, 2017 - 04:08pm PT
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So, let me get this straight: simplifying our tax system to lower the pointless overhead is good, but simplifying our healthcare system to lower the pointless overhead is bad?
P.S. Our healthcare system makes our tax system look like a model of efficiency.
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NutAgain!
Trad climber
South Pasadena, CA
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Topic Author's Reply - Jul 11, 2017 - 04:10pm PT
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For those who disagree with a strict flat tax- would you still disagree if it were slightly modified as follows?
1) Define a realistic baseline poverty level that is regionally adjusted for cost of living (e.g. survey of housing rental market and a "market basket" of groceries and utilities). Housing cost should factor in 2 people per bedroom.
2) All income below this poverty level is tax free, and all income above it is taxed at the flat rate.
A few problems I see with flat tax, even if you carve out a refuge for low income folks:
1. Government loses the financial "carrot" mechanism of encouraging societal behaviors. Consider renewable energy tax credits for example, or mortgage interest deductions.
2. Take just the mortgage interest deduction: if this disappeared, more people would choose to rent, house purchase demand would decrease, prices fall, the attractiveness of home purchase as a growing asset would diminish and further depress the housing market, people's mortgages go underwater for another round of government bail-outs...
3. Still need a large tax analyst organization (e.g. IRS) to dig into corporate finances and determine whether they are overclaiming business expenses to show a smaller profit to pay less taxes. Can't escape taxing profits rather than sales. A grocery store can't be taxed on it's revenue in the same way as a Software-as-a-Service business. Extremely different cost of goods/services sold and profit margins. Then you get into deciding what are acceptable costs of business- should marketing expenses be deductible? What about fancy office space to maintain a high value image? What about company cars for employees? Jets for executives to fly in person to close billion-dollar deals? Where do you draw the line? Is it possible to have a strictly enforced definition of COGS (cost of goods sold) that ties closely to what is actually delivered, as opposed to the administrative costs of running the business? Is it possible to hold small and large businesses with cheap or luxury business models to all have the same standards of acceptability for percentage of profits or revenues or projected revenues to spend on different types of things that the business owners ultimately hope will help them earn money?
Madbolter- do you think these speculations are off-base? How would your support of a flat-tax take these issues into consideration? IRS can never go away. You can name it something else but roughly the same number of people are doing the same thing- they just get reallocated from sparse coverage of personal tax returns to more dense coverage of corporate returns.
Edit / p.s. : If you say "then get rid of income tax and just tax spending"... how would this work in a corporate world... hmmmm... maybe pretty well? It would naturally curb the frivolous spending that our tax deduction mindset today supports. That is good. It would encourage people and companies to be more frugal in their spending, which is good for our collective saving. It would have a mixed effect on the revenues of companies: they would have higher costs from less tax deductions, but they would be more frugal so have lower costs too; the price they offer goods might go up or down depending on whether their lower costs from frugality or higher costs from lost deductions was a bigger factor; the number of sales would go up or down depending on customer demand relation to the price.... Hard to say on this piece.
But on the surface, I might be more on board with a federal sales tax and zero income tax. Still need an agency to audit sales tax collection (this is what IRS would morph into with no real loss of employees- maybe a net increase for MUCH more activity to audit). The key ingredient in making a federal sales tax work is to have a variety of baseline items tax-free like food, medicine, a single primary residence capped at a certain rate to avoid luxury loopholes (perhaps with regional market adjustments to get fancy), single primary vehicle with a capped rate to avoid luxury loopholes.
Another approach for dealing with the baseline vs luxury items in the same category: just tax everything point of transaction, and have a mechanism reclaiming the exempt part from the government. For example, every household gets a credit for food, shelter, medicine, and clothing. This way, the seller doesn't have to keep track of what is luxury clothing or not... IRS doesn't have to define and categorize each item. Rather, just set an allowance for everyone and credit that back to each household, but collect 100% on categories that can be mixed baseline and luxury items.
Even if all this is done, does it get us anywhere dramatically different than where we are now? You have a huge auditing responsibility still (now just tracking companies' revenues to see if the sales tax payments match up). But this is easier and less prone to loopholes and exceptions... it would ultimately be easier to automate, but still have to deal with companies evading sales tax reporting and hiding income.
It would penalize USA businesses in favor of international businesses from a consumer perspective. I would just buy stuff from Canada, Asia, and Europe and have it shipped to my house, rather than buy from a USA site that charges more for USA federal sales tax. This is already a factor for people in California buying stuff from states with no sales tax to get the cheapest price on stuff.
TL/DR: These issues are not simple to explore or solve. Clamoring for a simple solution reflects a simple mind. But with time and persistence, chasing down all the implications and fixes for various problems, you could end up with a different workable solution. But it would be nearly if not more bloated as what we have now.
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madbolter1
Big Wall climber
Denver, CO
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Jul 11, 2017 - 04:39pm PT
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How would your support of a flat-tax take these issues into consideration? IRS can never go away.
If you're saying that some agency like the Treasury Department can never go away, because the government will always be invested in revenue flow, then I totally agree. But that function need not even resemble the present IRS.
The points you raised are the most common ones levied against a flat tax. And, of course there's going to be some "baseline." Every proposed flat tax incorporates that idea. So, it's always been a straw-man to say "tax the poor."
Unless a flat tax is just going to become the same thing we have right now but with the only difference being a single tax bracket, with our same endless loopholes and deductions, it has to be a tax on pure INCOME/REVENUES rather than "profit." Thus, your points about the need of an "IRS" to oversee all these corporate (and personal) games and "deductions" go away. If you're an individual, you file the equivalent of a 1040EZ, and you're done. If you're a corporation, you file a similar form, and you're done. Upon request, you produce documentation to demonstrate that you were honest about your income/revenues. "Audits" become little more than a double-check of that one line-item.
Now, even simplifying things at that level still needs more "oversight" than is ideal, which is why I don't really "support" a flat tax. It would be better than our present system. But I believe that taxing income/revenues is really the wrong place to impose a tax, and that place does necessitate too much fine-grained government oversight. Remember that the income tax and IRS were created TO enable such fine-grained (literally punitive) oversight.
I much prefer a federal sales tax, which then would put taxes firmly into the purview of the present Treasury Department with no need of anything resembling the present IRS.
The government wants money, and it's going to ensure that it gets it. So, there is no avoiding "some" overhead on that front. But the present, literally, Gestapo IRS is way, way over the top in terms of what's needed and justifiable. A sales tax has endless advantages, not the least of which is getting the government out of every tiny detail of our financial lives.
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madbolter1
Big Wall climber
Denver, CO
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Jul 11, 2017 - 04:40pm PT
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Putting something in all caps, literally screaming via text, doesn't make your absurd statements true.
And your own unsupported statements, including calling me names, don't contribute anything of substance to this discussion. Of course, from your posts that I've seen, contributing has not been your goal.
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madbolter1
Big Wall climber
Denver, CO
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Jul 11, 2017 - 04:48pm PT
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But this is easier and less prone to loopholes and exceptions... it would ultimately be easier to automate, but still have to deal with companies evading sales tax reporting and hiding income.
If what you're after is anything approaching 100% compliance, then, like I "yelled," strict "efficiency" can ONLY be achieved in a truly totalitarian state. The less totalitarian you're trying to achieve, the more is going to slip through the cracks.
As it is, even with the Gestapo IRS, literally tons of income/revenue slips through the cracks. So, even throwing the resources we presently do at the problem doesn't solve the compliance problem.
Worse, at present the tax code is so absurd that we can spend piles of money as individuals and companies just TRYING to comply, and we're literally not able to do so.
Thus, I would say that "compliance" is always a moving target, but POS compliance is MUCH more likely to achieve better returns than our present approach.
Regarding how to handle tax-exempt items, POS machines already handle this just fine. Different municipalities and states already have a huge range of tax rates and exemptions. These are just programmed into the POS machines, and they just work. States, for example, are not pouring comparable amounts of money into "enforcement" as 1/50 of the IRS! They presume that the POS machines work, they rely upon "mostly" compliance of businesses, they do spot-checking, and they call it good.
No reason for the feds to not take the same attitude and approach.
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crankster
Trad climber
No. Tahoe
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Jul 11, 2017 - 04:51pm PT
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^^
Says the expert who sat on his hands the last election, allowing the GOP geniuses into office so they can ram this hideous bill down the public's throat in private, knowing their dim-witted leader who hasn't read three words of it will sign it.
All this endless chatter is meaningless without a plan to get people elected who will support meaningful healthcare reform. Otherwise, its just science fiction.
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madbolter1
Big Wall climber
Denver, CO
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Jul 11, 2017 - 05:58pm PT
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Says the expert who sat on his hands the last election, allowing the GOP geniuses into office so they can ram this hideous bill down the public's throat in private, knowing their dim-witted leader who hasn't read three words of it will sign it.
LOL!
Says the genius who KNEW that his gal could not lose and so expected half this nation to drink the insanity Kool-Aid along with his proposed criminal in chief. Didn't happen. Bwhahaha
My "dim-witted leader" got me Gorsuch on the court. I'm pretty happy about that at present, regardless of the many other things Drumf will certainly fail to get done.
Regarding "dim-witted," you mean, "Like with a cloth?" Hehehehe
Of note is that I didn't put the Rebumblecon Congress into place, and THEY are the much bigger problem. Drumf can't even get ANY tax-reform through those idiots.
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rottingjohnny
Sport climber
Sands Motel , Las Vegas
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Jul 11, 2017 - 09:08pm PT
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madbolter... I know you are....but what am I...?
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NutAgain!
Trad climber
South Pasadena, CA
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Topic Author's Reply - Jul 12, 2017 - 12:49am PT
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Madbolter, you are dismissing the issue of sales tax accounting and auditing. If you don't have a huge apparatus to audit it, then corporations will cheat. There is no honor and integrity and "take my word for it" that will work as the basis of maintaining our federal government revenues. We need a service that is responsible for revenues internal to our country- if we can just come up with a good name for it. ;)
I have run businesses that collect sales tax from customers. The more money you collect, the more frequently you have to file forms and deposit money to the collecting agency (Franchise Tax Board of California in my case). The numbers you declare there must match up with the company accounting records. There are audits of it.
So it's not as clean and simple as you are saying. Measure and track a different thing if that better achieves a desired policy, but we still need the huge apparatus to make sure money is coming in to federal coffers. Streamlining I'm all for, but it won't be as much as you think.
And you didn't address the issue of discouraging American businesses compared to international competitors.
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crankster
Trad climber
No. Tahoe
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Jul 12, 2017 - 06:52am PT
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My "dim-witted leader" got me Gorsuch on the court. I'm pretty happy about that at present
That's all you got in the Faustian bargain? Weak sauce, shoulda asked for more.
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madbolter1
Big Wall climber
Denver, CO
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Jul 12, 2017 - 06:55am PT
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That's all you got in the Faustian bargain? Weak sauce, shoulda asked for more.
I got ALL that I wanted. I got: Not-Hillary.
Gorsuch was icing on that satisfying cake!
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madbolter1
Big Wall climber
Denver, CO
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Jul 12, 2017 - 06:56am PT
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And you didn't address the issue of discouraging American businesses compared to international competitors.
Hmmm... the baleful effects you describe don't seem to be the case at all in Canada, which has had a federal sales tax for decades.
I run a business in Colorado, and the forms are simple, and, yes, must match. But we're not continually audited.
You're making this out to be a bigger deal than it really is.
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