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Stanford Professor Loses Political Battle To Simplify Tax Filing Process

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Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#151

Post by joshuaheard »

jkaptur wrote: post #116
avar wrote: post #110

This whole thread is full of comments from people who obviously haven't read the article / listened to the podcast in question[1]. Joseph Bankman proposed ReadyReturn in California, which is the kind of tax return pretty much the entirety of the rest of the western world uses. I.e. instead of an empty return, it's pre-filled in with the details the government knows anyway. This vastly simplifies things for most peopl…

I think that a major component of Norquist's thinking is that the more painful people find taxes (including the process of calculating them) the more they'll support his agenda of "a government so small you could drown it in a bathtub".

I think it's also akin to the withholding tax. If people had to write a check every year, there would be outrage to the amount people are actually paying. Instead, they are grateful for the government "giving" them a tax refund!

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#152

Post by mullen »

sgustard wrote: post #39
gamblor956 wrote: post #14

Correction: this proposal would not have simplified taxes (i.e., the California tax code). It would merely have simplified the filing of tax returns for the most common case, salaried workers receiving all of their income from a single source. Very big difference. HRBlock and Intuit are heavily vested in maintaining the current tax filing system. They are not, however, meaningful players in the attempts to rewrite th…

How is the proposal different than California's current online filing? https://www.ftb.ca.gov/online/calfile/index.asp

CalFile morphed from Ready Return. The Tax Franchise Board created CalFile since they did not need permission to do it.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#153

Post by OrwellianChild »

Zelphyr wrote: post #132
barrkel wrote: post #124

Earlier quoted context omitted.

A flat tax hurts people with lower income more, because they have less disposable income to begin with - a lower proportion of their income is discretionary.

One of the aspects of The Fair Tax, which is basically a flat tax, is the idea of a "prebate" - a sum of money (between $4-7K if I recall) that is paid to each taxpayer every year to help cover the basics like bread and milk.

I mean, great, but now you're back to tax brackets... May as well stick with the graduated system.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#154

Post by twblalock »

Zelphyr wrote: post #132
barrkel wrote: post #124

Earlier quoted context omitted.

A flat tax hurts people with lower income more, because they have less disposable income to begin with - a lower proportion of their income is discretionary.

One of the aspects of The Fair Tax, which is basically a flat tax, is the idea of a "prebate" - a sum of money (between $4-7K if I recall) that is paid to each taxpayer every year to help cover the basics like bread and milk.

So it's not really a flat tax -- it's just a tax system with tax credits and fewer brackets than we have now. I'm sure there will be other popular proposals for tax credits and deductions: EITC? Charitable donations? Investment losses? Mortgage interest?

If we adopt a flat tax, we will eventually turn it back into the same tax system we have now, for the same reasons we ended up with our current system in the first place -- people like all of the credits, deductions, and exclusions they get now, and they would vote to restore them in a heartbeat.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#155

Post by schoen »

joshuaheard wrote: post #151
jkaptur wrote: post #116

Earlier quoted context omitted.

I think that a major component of Norquist's thinking is that the more painful people find taxes (including the process of calculating them) the more they'll support his agenda of "a government so small you could drown it in a bathtub".

I think it's also akin to the withholding tax. If people had to write a check every year, there would be outrage to the amount people are actually paying. Instead, they are grateful for the government "giving" them a tax refund!

Maybe this is psychologically related to

https://en.wikipedia.org/wiki/Loss_aversion#The_endowment_ef...

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#156

Post by mullen »

smt88 wrote: post #88
gnopgnip wrote: post #22

Earlier quoted context omitted.

How can you fix money in politics without making the whole system worse?

1) Campaigning is restricted to a short time period, perhaps 6 months. 2) Every candidate gets a (small) fixed budget, paid for by tax-payers. (This is already the practice in some countries.) 3) Ads are subject to the same laws that govern ads for products: say whatever you want, but you can be sued for lying. Any of those ideas sound good?

> 1) Campaigning is restricted to a short time period, perhaps 6 months.

You can't do this without limiting Free Speech.

> 2) Every candidate gets a (small) fixed budget, paid for by tax-payers. (This is already the practice in some countries.)

Might be possible.

> 3) Ads are subject to the same laws that govern ads for products: say whatever you want, but you can be sued for lying.

Lying is Free Speech.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#157

Post by sokoloff »

avar wrote: post #128
hundt wrote: post #103

FWIW, here's an email I sent to Prof. Bankman last April: --- I read with interest your letter about the Tax Filing Simplification Act of 2016, and your article "Simple Filing for Average Citizens: The California ReadyReturn." I agree that the tax filing burden on taxpayers is far too high, and I am encouraged that legislators are trying to do something about it. But I am concerned about the details of actually accom…

I've never had to file US taxes so this might be a stupid question, but how exactly are the people in your example worse off with ReadyReturn? Isn't ReadyReturn just e.g. summing up their reported wages for the return, which they'd need to do accurately anyway if they were filling it in from scratch? Yes, if you have a pre-filled in tax return nothing that the government doesn't know about & which might be deductible…

> Now you'll have more time to fill that out, instead of doing menial work like manually summing up your monthly payslips to arrive at a yearly total.

There is no manual summing of paystubs. You (already) get an end-of year statement of wages (W-2 for employee wages, 1099 for contracting payments). ReadyReturn saves you nothing here.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#158

Post by ryandrake »

Aloha wrote: post #106
ryandrake wrote: post #95

The problem I have with the popular "simplify" US tax proposals is that they mostly do it by repealing whole sections of the tax code, ending up super regressive and/or hurting the poor and middle class and helping the already rich. Flat tax @ a high rate: Neutral or slightly helpful to the rich, crushing to the poor and middle class Flat tax @ a low rate: Windfall to the rich, the resulting gutting of government pro…

Have you considered that the tax system shouldnt /help/ anyone? Trying to further social policy via taxation is about the least efficient way to do it. Treat all income the same, do not allow deductions, charge a medium rate (10-25%), exempt the first 35-50k a year - no special rates for married filers (everyone files single), no deductions for dependents. Eliminate corporate income tax entirely, replace with a VAT a…

Any tax system will have winners and losers, including no tax system at all, including one where the treasury burned the collected money rather than used it to pay for social programs. Who ever designs the tax system directly chooses the winners and losers--it cannot be avoided.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#159

Post by mullen »

Aloha wrote: post #106
ryandrake wrote: post #95

The problem I have with the popular "simplify" US tax proposals is that they mostly do it by repealing whole sections of the tax code, ending up super regressive and/or hurting the poor and middle class and helping the already rich. Flat tax @ a high rate: Neutral or slightly helpful to the rich, crushing to the poor and middle class Flat tax @ a low rate: Windfall to the rich, the resulting gutting of government pro…

Have you considered that the tax system shouldnt /help/ anyone? Trying to further social policy via taxation is about the least efficient way to do it. Treat all income the same, do not allow deductions, charge a medium rate (10-25%), exempt the first 35-50k a year - no special rates for married filers (everyone files single), no deductions for dependents. Eliminate corporate income tax entirely, replace with a VAT a…

> Trying to further social policy via taxation is about the least efficient way to do it.

Works well for controlling a populations smoking and drinking.

Re: Stanford Professor Loses Political Battle To Simplify Tax Filing Process

#160

Post by twoodfin »

smt88 wrote: post #88
gnopgnip wrote: post #22

Earlier quoted context omitted.

How can you fix money in politics without making the whole system worse?

1) Campaigning is restricted to a short time period, perhaps 6 months. 2) Every candidate gets a (small) fixed budget, paid for by tax-payers. (This is already the practice in some countries.) 3) Ads are subject to the same laws that govern ads for products: say whatever you want, but you can be sued for lying. Any of those ideas sound good?

So the New York Times can only say good or bad things about elected officials and potential candidates for the six months before an election?

If not, people with money looking to campaign outside your window will just buy media companies.

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