Posted on 07/10/2008 5:41:56 PM PDT by Kaslin
With the annual exercise to limit its effect afoot, there is again much consternation over the alternative minimum tax. Forcing ever more taxpayers into a more onerous parallel tax system, the AMT has earned its place as the tax Yet despite elevated publicity, its effect is only a fraction of that coming in 2011 when the 2001 tax cuts expire. In fact both, not simply the AMT, demonstrate a tax system completely awry and two tax increases that must be avoided. The AMT is a prime example of government compounding problems it created. Conjured into its first incarnation in 1969, the minimum tax was intended to correct the "problem" of a few hundred wealthy nonpayers of income tax. That this was a problem at all is questionable, since these people used legal means and presumably received lower economic returns — such as accepting lower interest yields from tax-free bonds. But simply solving a simple problem — repealing offending tax provisions allowing avoidance or prosecuting malefactors practicing evasion — is rarely Washington's way. Instead such was the genius of the genesis of a second, parallel tax system that would flatter Rube Goldberg. The first comprehensive AMT came in 1982 with "one overriding objective," as Congress' accompanying report stated: "No taxpayer with substantial economic income should be able to avoid all tax liability by using exclusions, deductions, and credits."man's bogeyman.
(Excerpt) Read more at ibdeditorials.com ...
The first comprehensive AMT came in 1982 with "one overriding objective," as Congress' accompanying report stated: "No taxpayer with substantial economic income should be able to avoid all tax liability by using exclusions, deductions, and credits." (bold added)
This conflates two very different concepts: tax evasion and tax avoidance. The former is quite illegal, and should be prosecuted vigorously; whereas the latter is entirely legal and, notwithstanding leftists' protestations to the contrary, is perfectly ethical also.
Liked the article until this statement:
“No wonder people are clamoring for change. Yet in truth most Americans intuitively know Washington has little direct effect on either gas prices or the economy. But Washington does have direct responsibility for taxes collected by the tax code it enacted.”
Washington is DIRECTLY responsible for gas prices, it’s called currency devaluation. Washington is DIRECTLY responsible for our economy it’s called the Fed creating excess liquidity. Not to mention legislating or repealing economic safeguards. One big citizenship collective wags it’s collective finger at Washington and we the majority are correct to do such.
If we do not vote out bums, we get more bums with even greater resources to remain in power. We just simply have reached a point where it has become near impossible to simply vote them out now. So now we the collective must be creative and do things the hard way which is to end there money supply. At the end of the day, we the collective simply are looking into a mirror up there on the Hill, and are more resentful our party has ended while Washington’s goes on. The money supply ends itself for us but now we must end there’s. So sad and confusing dillema.
If any American pays tax, then every American should pay tax.
And it should be at the same rate.
I don’t want someone acting as if they have any more claim on this country than I do.
Finally, I think a sales tax of about 9% on everything with no exceptions would give the nation the money to pay for those things that governments should pay for.
Something to counter those who demand that the government socialize medicine and the energy industry...
“You want to give complete control of your health care, and the industry that heats, cools, and powers your home to the bunch of morons who have set up the income tax system? These are the idiots who operated their own restaurant at a deficit for more than 20 years, requiring multiple tax-payer bailouts!”
Mark
I rather like the idea of a progressive tax, used as an incentive to earn more...
I think it was Neal Boortz who suggested that the low wage earners should pay higher tax rates, and the more you make, the lower your tax rate would be, inspiring you to make more.
I swear, it seems that we’re living in a novel written by Ayn Rand...
Mark
I wonder if there are liberals who think the 401K pre-tax contributions and Roth IRA are tax evasion - and then work to tax both retirement plans both ways.
Don't you think she would've just loved Frank Sinatra's "My way"?
Flat Tax - 15%. Income, Capital Gains, Dividends.
Child exemption, 1 mortage exemption. Nothing else.
Our tax code is a playground for corruption and lobbyists seeking advantages over everyone else.
“No wonder people are clamoring for change. Yet in truth most Americans intuitively know Washington has little direct effect on either gas prices or the economy. But Washington does have direct responsibility for taxes collected by the tax code it enacted.”
The entire premise of the New Deal and Congress assuming authority to regulate anything they could "find to have a substantial effect on interstate commerce" was to enable them to control the economy.
It's obviously not working, so let's stop doing it.
I agree about the flat tax. I also would like to see social security treated the same. Pay ss tax on every dollar earned, no cap.
That's a rhetorical question, right?
Of course they do. You obviously have too much money if you can't figure out how to spend it all. And where else are they gonna get the money for their constituents bribes health care at government expense.
Nothing could be further from the truth than your impression of Boortz wanting low wage earners to pay higher tax rates.
A progressive tax is one that has higher wage earners paying more tax. An income tax is a progressive tax. A straight consumption tax is a regressive tax, one that has low wage earners paying more of their earnings as a percentage for necessities of life. This is called the ‘disproportionate burden’ argument that was used to bring about the income tax.
But the ‘FairTax’ is a consumption tax that is progresssive because it includes a Rebate that is the same for every person. The Rebate completely untaxes the poor. The Rebate corrects the ‘disproportionate burden’ that Americans faced more than one hundred years ago. Those Americans did not have the technology to have a Rebate administered so they adopted an income tax on the rich, and that tax was a flat 7% income tax on very high income receivers (less than 2% of the population).
The income tax is like cancer. The FairTax is healthy.
The FairTax (intentionally no space between r and T) taxes only when we spend. We are all motivated to spend in one form or another and eventually no matter how much income we make it will be spent at some point.
The Flat Tax is an income tax.
Let’s repeat that, the Flat Tax IS an Income tax.
The present Income tax started out as a flat tax in 1913. It taxed the very wealthy (less than 2% of the population) at a maximum of 7%.
This first income tax, like a cancer, grew into a complex mess because Congress has the power to ‘define’ the word Income and to redefine it via amendment to the Tax Code. Even when it finds it difficult to exclude certain revenue as ‘income’, Congress has defined what is and what is not ‘taxable income’. All of this cancerous tax code stems from the 16th Amendment.
The tax cancer needed five courses of radiation treatment in the form of five major tax reforms in the past one hundred years. Each reform attempted to reflatten the code, to make it more simple and ‘flatter’. The last reform was in 1986 and since them there have been more than 16,000 amendments to the tax code.
If you support a flat tax, you will see the mess we have today come back like cancer within a few decades or less.
Any ‘Income’ tax will grow in complexity and will encourage corruption. That includes any flat tax because again, any flat tax is an income tax.
The solution is not a flat tax, it is the ‘FairTax’.
No, he was making a point on his radio show, showing how the "progressive tax" was actually damaging the chances of people with low wages to improve their economic standing. So he opined that maybe if they were forced to pay a higher percentage in taxes, they'd be more motivated to work to educate themselves, get better jobs, and earn more.
Mark
That’s one big argument against it - it isn‘t “fair“.
“Poor” need to pull their weight. “Untaxing” them releives them from doing that.
One hundred years ago there weren’t the umpteen programs and services catering to the “poor.” Now you have every subsidy from food to housing to utilities, transportation, education, health care, child care - you name it.
“Wealthy” are paying disproportionately relative to their consumption of public resources (none). THAT’S your “disproportionate burden” - paying the freight for someone that is under-producing and over-consuming.
Time for the American underclass to step up and pay their FAIR share. And yes, there should be a stigma associated with being a freeloader - it should be something they take great pains to AVOID.
I have two preschoolers - it’s hard NOT to spend all the money.
Think of grandma on Social Security at $970 a month. Think of those that have health problems or parents raising young children.
These are the people that should taxed little if at all.
Neil Boortz is one of the biggest supporters of the FairTax and the FairTax taxes those who spend while rebating everyone the same amount up to the level of poverty, so the poor are untaxed.
You either misheard him or took him out of context. If he slipped in a quip about the young wage earners not understanding the tax burden associated with being successful, then I am sure it was tongue-in-cheek.
Anyway good luck with whatever point you are trying to make. I noticed you were unappreciative of the information I gave you. To you I suspect it was worthless information and I would wager you never looked into it.
Everyone, let me repeat EVERYONE gets the same rebate. That’s why it’s fair.
If Grandma on Social Security of $970 a month gets a rebate of $196 a month, and billionaire Warren Buffett gets a rebate of $196 a month, how is that unfair? Grandma will end up paying no tax whereas Buffett will pay tax if he spends more than $10,294 a year (the federal poverty level).
The FairTax is completely fair.
Our entire tax system is an arbitrary set of laws. There is no rhyme or reason for it other than keeping the fat cats at the public feeding trough. So if you think any of your money is safe just because it's in some other account that was set up by some weird arbitrary tax law ... you're crazy.
Don't get me wrong it makes sense put some of your money into these tax sheltered vehicles. You know just in case the fat cats decide not to go after it. But my guess is they look at 401Ks and IRAs as the lockbox for social security. They are just waiting for the right moment to take it.
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