Posted on 03/09/2009 6:57:52 AM PDT by Brookhaven
If you include social security and self-employment tax, the income tax rate is already more than 50%. I know that for a fact.
Not a tax rate (according to the text that was excerpted) but a cumulative tax amount. Local, state, payroll taxes combined with fed income tax not to exceed 50% of income.
“What would be the disincentive for state or locals to not increase taxes (up to 50%)”
That’s right, but it’s even more complicated than that. Most of us high income folks have many tax deductions that reduce our total tax burden to something like 20-30%. If we all accept a 50% limit in total then BOOM! You pay 50%! No tax deductions. Which is exactly what Obama is proposing for high income folks, dropping the home mortage deductions and the charitable giving deduction. Really the best system would be the Fair Tax www.fairtax.org, but that is impossible with our current leadership....
“What would be the disincentive for state or locals to not increase taxes (up to 50%). They could always say “You’re not going to pay more than 50%”, so don’t worry about it.”
None, but so what?
Look at what happens now. With our hodge-podge system of taxes, each tax-authority can say “we’re only raising taxes a little”. Local raises it 2%, the state raises it 2%, and the feds raise it 2%. They can all claim the only raised taxes 2%, but the cumulative tax raise is 6%.
I’d love nothing more than having the federal government telling states to LOWER their income tax rates, because they are depriving the federal government of tax revenes.
I know, but do you think the average citizen is aware of this? After reading this thread, I'm not even sure the average Freeper is aware of this.
I think this proposal would cement it in everyone's mind. It would bring to the foreground the fact that there are people today paying over 50% in total taxes.
I think this is a solid idea. What I need now are suggestions for getting it to the right people who can take it to the next step (introduce legislation, have a bully pulpit to drive the idea, etc...)
“That’s right, but it’s even more complicated than that. Most of us high income folks have many tax deductions that reduce our total tax burden to something like 20-30%. If we all accept a 50% limit in total then BOOM! You pay 50%! No tax deductions. Which is exactly what Obama is proposing for high income folks, dropping the home mortage deductions and the charitable giving deduction. Really the best system would be the Fair Tax www.fairtax.org, but that is impossible with our current leadership....”
There is no proposal to drop any deductions. There is no proposal to set taxes at 50%. It is simply a cap.
You are right that Obama would love to eliminate tons of deductions and raise the tax rate to punishing levels. And he is GOING TO DO IT. If we don’t take some action now, those people currently paying 20-30% are going to find themselves in the 60%+ bracket overnight.
Think of this cap like a governor on an automobile that limits your speed to 50 mph. Nothing is preventing you from driving lower than 50 mph, but you can’t go over 50 mph.
This cap wouldn’t prevent the government from keeping taxes below 50%, but it would prevent Obama from rasing taxes over 50%.
50%?!!!!
try 25% is more than enough for the government to take.
“That’s right, but it’s even more complicated than that. Most of us high income folks have many tax deductions that reduce our total tax burden to something like 20-30%. If we all accept a 50% limit in total then BOOM! You pay 50%! No tax deductions. Which is exactly what Obama is proposing for high income folks, dropping the home mortage deductions and the charitable giving deduction. Really the best system would be the Fair Tax www.fairtax.org, but that is impossible with our current leadership....”
Understand also that it is small businesses that are going to get hit the hardest with the tax increases Obama proposes (the people that we need to create jobs.)
My guess is the tax breaks for the super-rich that lower their burden to 20-30% are not going away, despite the fact that Obama seems intent on punishing the super rich.
They fought the Revolution over a tax rate FAR LOWER than that!
You do know we were over the 50% number under Bush don't you? Obama wants to rasie it even higher.
Everybody has a number they think is fair, but if we argue endlessly about the number we'll never get anything done. We need to do three things:
1. Establish the concept that their is a maximum percentage that is fair.
2. Set some number as a STARTING POINT. 50% has emotional impact. It's a number we can win with, because it is going to strike people in the gut that paying more that that is unfair (it is also less than many people already pay today, so we actually will be LOWERING taxes for many people.)
3. We can work to start lowering the number from 50%. We can start saying it is unfair to force people to pay more than one third of their income in taxes. But we can't do that until we do #1 & #2.
God Himself only wants 10%.
Who the heck do these people think THEY are to deserve more than THAT?
Besides getting angry, what do you plan on doing about it?
“On that note why should anyone be robbed of 50%?”
I’m trying to lower the cumulative tax amount DOWN to 50%.
You do realize don’t you, that TODAY there are not only people that pay over 50%, they pay over 60% of their income in taxes. Go find some small busineess people and find out.
You act like I’m trying to raise taxes. I’M TRYING TO LOWER THEM.
And let NYers, for example pay far less than those from more frugal states? I don’t think so. You’d be creating a massive incentive for states to tax higher and higher. Unintended consequences and all of that.
Yes I got it before, but I still think this sends the wrong message. 50% is still an egregiously high wmount.
“And let NYers, for example pay far less than those from more frugal states? I don’t think so. You’d be creating a massive incentive for states to tax higher and higher. Unintended consequences and all of that.”
As opposed to the tax creep we have now? Cumulative taxes in the current system are already well over 50%. Maintaining the current system gurantees the rate will be over 50%.
No doubt you would have some states that would take the opportunity to raise state taxes. Maybe that could be addressed by creating a formula for the overage that causes BOTH the state and federal government to lose a portion of taxes to lower the total down to 50%. That would create an incentive for the federal government to try and keep state taxes down, and the state to try and keep federal taxes down.
I’m working as part of the committee organizing Philadelphia Tea Party II.
I’d go Galt if I could...
“Yes I got it before, but I still think this sends the wrong message. 50% is still an egregiously high wmount.”
I agree, but since we are already well past the 50% mark what do you suggest we do? Simply let taxes increase unchecked to the 50, 70, or 80% mark?
This at least creates a barrier, a starting point that we can work against to lower taxes from.
A lower barrier point.
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