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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

#241

Post by avmich »

hermitdev wrote: post #211
quadrangle wrote: post #182

Earlier quoted context omitted.

Yeah, zero FEDERAL income tax but most of those pay for SS, Medicare, and state taxes. Those in a lump sum vs withholdings would still be a different experience.

The number of US citizens that pay federal income tax is closer to 35%. All forms of income tax ought be abolished. A consumption tax of around 18% would provide the same federal revenue. It would simplify tax reporting (i.e. reduce expenditures on tax reporting), and increase the tax base (people living on trust funds would pay in at a higher rater). Look into the "Fair Tax" for a well reasoned proposal for such a t…

Answering to one of replies.

> Federal "revenue" is a mistaken concept. The federal government just deletes money via taxation in order to offset the created money from spending. The government doesn't need or have any dollars, they are the source of the fiat currency in itself.

Does it mean that taxation in USA works differently than taxation in a country with currency tied to US dollar by a fixed exchange rate? In that country government can't, I assume, so easily print money and delete them.

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

#242

Post by avmich »

quadrangle wrote: post #219
toomuchtodo wrote: post #190

Earlier quoted context omitted.

That's not withholding though (as the parent referred to; withholding towards your federal income tax bill); as you mention, that's payroll taxes, which you're going to get in retirement back as entitlements. Consider what would happen if the IRS was efficient enough (through these automated tax accounting systems) to not get an interest free loan from working America for an entire year (ie dynamically modifying ever…

"IRS gets a loan" is metaphorically true in a sense but really doesn't hold up to scrutiny. The IRS doesn't actually get money from taxpayers at all. The IRS is just the bureaucracy that determines things. The money that you "pay" in federal taxes is just dollars that are deleted out of existence so that the dollars created by federal spending don't create inflation. The federal government's "cash flow" is made up en…

> The money that you "pay" in federal taxes is just dollars that are deleted out of existence so that the dollars created by federal spending don't create inflation.

Does it mean that taxation in another country is different than taxation in US? Especially in a country where local currency has a fixed exchange rate to US dollar? They presumably can't create money that easily.

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

#243

Post by clarkmoody »

toomuchtodo wrote: post #190
quadrangle wrote: post #182

Earlier quoted context omitted.

Yeah, zero FEDERAL income tax but most of those pay for SS, Medicare, and state taxes. Those in a lump sum vs withholdings would still be a different experience.

That's not withholding though (as the parent referred to; withholding towards your federal income tax bill); as you mention, that's payroll taxes, which you're going to get in retirement back as entitlements. Consider what would happen if the IRS was efficient enough (through these automated tax accounting systems) to not get an interest free loan from working America for an entire year (ie dynamically modifying ever…

> you're going to get in retirement back as entitlements

No. Taxes are not prepayment for services in the future.

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

#244

Post by toomuchtodo »

MaysonL wrote: post #233
toomuchtodo wrote: post #215

Earlier quoted context omitted.

Income tax is not payroll tax! Income tax -> Federal income tax (discretionary spending) Payroll tax -> Social security and Medicare (non-discretionary spending) Everyone pays into entitlements via payroll tax. Not everyone pays into discretionary spending (everything except social security and medicare).

Which is why the government borrows the SS and Medicare tax payments to use on other stuff and puts IOUs in the SS and Medicare trust funds.

The US government lends itself SS and Medicare funds because there is no safer asset class than US treasuries.

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

#246

Post by toomuchtodo »

MaysonL wrote: post #232
toomuchtodo wrote: post #169

Earlier quoted context omitted.

I don't think so. 45% of Americans pay zero income tax, even accounting for withholding.

Unless you realize that Social Security and Medicare taxes are actually income taxes: they go up directly the more you make.

No. Social security is only taxed on your first $127,200 of annual income. Anything over that is not assessed social security tax. Medicare is 1.45% of your income with no limit, and an additional 0.9% on income over $200k/year. I'm unsure where you would get the idea that those rates increase as your income increases.

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

#247

Post by smt88 »

mullen wrote: post #156
smt88 wrote: post #88

Earlier quoted context omitted.

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.

Lying is free speech, but you can already sue if someone's speech is false and then damages you. A candidate's lies should qualify as damaging to someone who votes for them under false assumptions.

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

#248

Post by onlyrealcuzzo »

cwkoss wrote: post #108
TeMPOraL wrote: post #79

Earlier quoted context omitted.

A more important question I never see addressed is how you prevent "money in politics" from unfixing itself as soon as you're done with the fixing? Money and political influence are two sides of the same coin - power. Money gives more influence, which attracts more money, and so on, in a positive feedback loop. How do we break, or at least control, that loop? Is it even possible?

Decentralization of power. For example, I'd love to see a progressive tax rate for corporations: companies' tax rates would be based on total revenue or profits. ex. If your company earns less than $50k/year, no taxes, 10% tax rate up to 250k, 20% up to $1M, 40% up to 10M, 50% on earnings over $10M. This would provide a strong incentive to only maintain a large corporation if the value of your economy of scale exceed…

I've never encountered this concept before, but I appreciate the introduction greatly! I love this idea.

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

#249

Post by JDiculous »

This is infuriating because the simplified tax system is objectively superior. Any Congressperson who voted against this was either 1. stupid or misinformed 2. bought out by Intuit.

It seems to me that the only way to mitigate the effect of lobbying, aka legalized bribery, is to publicly call out the politicians who sell out.

Is there a list of representatives who voted against this bill?

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

#250

Post by chetanahuja »

meddlepal wrote: post #230
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'm nearing the point of being completely convinced nothing is actually improvable anymore in the US. If you touch anything, even the most broken or inhumane thing, you'll find someone defending it until the death either because of vested interests or ignorance.

Yup. US system of passing laws through congress is now broken to such an extent that the only things that can pass unmolested are esoteric bills that (usually) shift money from the taxpayer to big corporate lobbying group in such a way that the common person can't (or isn't bothered enough) to understand. That's one of the reasons most of a President's power is expressed through executive orders directives to federal agencies selectively enforce or ignore laws passed by congress. That is also why passage of Obamacare will forever be remembered as a huge legislative accomplishment the likes of which will probably not be replicated again in our lifetimes.
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