Two Different Perspectives on Taxes

[eridanus]

Quote:

Originally Posted by Rustic23 eridanus I find you post a little disturbing. 'If the rich only paid on their usage or need, "fairly," then the burden would increase a lot more on the middle and lower classes.' This comes across as 'We can't be fair to the rich, I would have to pay more' Capitol Monitor

The rich pay a lot of taxes. Let's have them pay less. Ok, now the government is short even MORE money. Do you intend to then raise the taxes on the middle and lower classes? What services/functions do you intend to cut?

I guarantee that what I want to cut is your sacred cow and vice versa.

[eridanus]

Quote:

Originally Posted by ERD50 I don't think any discussion on tax revenue should *start* with what % we should take. It should start with what amount we need to collect to provide for the common good. How to collect it should be separate from that.

Fair enough.

1) We need $X to run services. What services do we actually need? What services do we want?

2) How do we get $X? What tax(es) is most beneficial to sustain/increase productivity and provide for the common good?

[Koolau]

Quote:

Originally Posted by landonew For people in the top 25% annual income, the number is estimated at about 54.4 cents out of every Dollar you earn actually goes to uncle sam (or a state/local equivalent). How much tax do we really pay? Its really pathetic if you think about ALL the double taxation that goes on.

Double? I wish! Here in paradise, we have an excise tax which is nominally just under 5% (here on Oahu - 1/2% less on other islands). However, this tax (at various rates) is collected at all levels of the supply chain and on EVERYTHING. I've seen estimates as high as 16% by the time the consumer actually tallies up his "sales tax" equivalent. I can't confirm that, which is part of the problem, isn't it?

I suppose if that were the only state tax, it wouldn't be so bad. But we also have as high as 8.5% income tax as well as many, many other taxes, fees, assessments, etc. etc.

I always knew that the COL here would be higher than on the mainland. However, it appears that a very significant portion of that difference is actually taxation. I accept that I have to pay it to be here, but I can attest that the services here are no better (and often worse) than other, much lower tax areas. I guess you pays, yer money, etc. etc.

[Bikerdude]

I would vote for a tax on consumption. The more you consume the more you pay. This would include services as well as purchases. Have 5 kids, then pay five times the school tax and so on.

But, alas, this will never happen because our society is based on consumption and the families having five kids don't have any money.

The rich dodge normal taxes. Here in CT they raised the income tax on millionaires, they turn around and buy a Condo in FL and live there 6 months and a day. Viola, no income tax. The list of loop holes goes on and on.

[DougViages]

Is: Incentives Matter. Your CT neighbors have been incentivized to move to a low income tax state - Florida.

The second rule: There's no such thing as a 'free lunch'. Just like elementary physics, actions cause reactions, and for economics, resources spent in one area are ultimately taken from other areas.

Codicil: Watch for Unintended Consequences.

[stephenandrew]

Quote:

I think you missed a few: Sales tax Corporate paid taxes embedded in the things you buy Transfer taxes on the stock/bond trades you make

Yes---you are of course correct--I omitted those only becasue I don't really know the precise amount. I always find reading my cell phone bill amusing--all sorts of taxes and fees

Quote:

Good observation. Reminds me of the part of the Woody Allen movie: Q. How often do you have sex? Man: Hardly ever; about two times a week. Woman: All the time; about two times a week.

LOL---I agree--if I am not mistaken this is from Annie Hall. Another good line from that movie occurs after Annie parallel parks the car on a NYC street, Woody gets out, and says "Its fine--I can walk to the curb from here."

[Rustic23]

Eridanus,
So lets follow your logic. Bill Gates, Warren Buffet, and all the other billionaires will send in all their wealth except lets say $65,000 about the average household income. Problem solved.

let's see... how do you spell SOCIALISM?

The only thing in your argument and the one above is where do we set the boundaries!

[Bikerdude]

Quote:

Originally Posted by DougViages Is: Incentives Matter. Your CT neighbors have been incentivized to move to a low income tax state - Florida.

That was my point.

[Texarkandy]

Quote:

Originally Posted by eridanus The rich pay a lot of taxes. Let's have them pay less. Ok, now the government is short even MORE money. Do you intend to then raise the taxes on the middle and lower classes? What services/functions do you intend to cut? I guarantee that what I want to cut is your sacred cow and vice versa.

There are very few cows that are truly sacred.

As regards Federal spending, my "sacred cows" only extend as far as those items enumerated in a somewhat restrictive reading of the Constitution. (which I believe to be more of a restraining document than an enabling one)

The States, I believe, have a greater authority to tax & spend. I pay my State & local Property & sales taxes with much less resentment than I do my Federal taxes.

(Kind of a funny position for a fed employee, huh.)

[unclemick]

Quote:

Originally Posted by Rustic23 Eridanus, So lets follow your logic. Bill Gates, Warren Buffet, and all the other billionaires will send in all their wealth except lets say $65,000 about the average household income. Problem solved. let's see... how do you spell SOCIALISM? The only thing in your argument and the one above is where do we set the boundaries!

Socialism = file single. Starting my Turbo Tax for the year. By the time I finish it's best I not post on any thread involving taxes.

Cause I will be against everything.

heh heh heh -

[eridanus]

Quote:

Originally Posted by Rustic23 Eridanus, So lets follow your logic. Bill Gates, Warren Buffet, and all the other billionaires will send in all their wealth except lets say $65,000 about the average household income. Problem solved. let's see... how do you spell SOCIALISM? The only thing in your argument and the one above is where do we set the boundaries!

You gonna answer the questions or continue to dodge it by putting words in my mouth?

If you cut taxes on the rich to be fair,

1) Where and on whom will you raise taxes?

2) If you don't wish to raise taxes, what will you cut?

[eridanus]

Quote:

Originally Posted by Texarkandy As regards Federal spending, my "sacred cows" only extend as far as those items enumerated in a somewhat restrictive reading of the Constitution. (which I believe to be more of a restraining document than an enabling one) The States, I believe, have a greater authority to tax & spend. I pay my State & local Property & sales taxes with much less resentment than I do my Federal taxes. (Kind of a funny position for a fed employee, huh.)

We can start with cutting the pensions and retiree health benefits of federal employees.

[Rustic23]

OK, well I did, give you a link as a place to start, and I doubt that we would agree on much. But here goes:

Everybody should pay income tax. Lower class, middle class, upperclass and all in between. And, before you say it, I don't count payroll tax!

Cut government spending. While it is not the smart way, just cut every agency a percentage. A better way is to say the Federal budget must be cut by X% and force the agency to live within strict budgets. If you can't live with that just cut everything 10%. Everyone of the agencies will survive and thrive.

Cut duplicate programs. As pointed out in the article there are 27 different agencies/programs dealing with teen pregnancies. Certainly we can get by with 26!

Re-examine the entire roll of Federal government. Education is not a federal job. Unless you are one that can find just about anything in the constitution. For the first 200 years or so, education was the purview of local government, not even the state. The education bureaucracy continues to grow every year.

Cut out Federal subsidies. Yep, farm, air line, energy, wooden arrows, you name it, stop spending my and your money on it. I can live with my cow dying, and I'll bet you can live with it when yours does.

Curtailing Federal spending hurts only one group of people. POLITICIANS!

Your and my representatives and senators believe it is their duty to bring home the pork, and they are rewarded for it. Your fault and mine.

Do you really think that the Federal Government can't get by on last year's budget with no increase, not even for inflation? Do you really think the 850B is going to create jobs? Do you really think it has to be passed in the next 3 days when most of the money will not be spent for about 2 years? Do you really think the country can go on stealing from the rich to give to the not so rich?

Stop spending Federal Dollars on State projects. If Las Vegas wants a museum to Gamblers let them build it. Why did Texas dollars go to build the Rock and Roll Hall of Fame in IL. Why did CA money go to build a theater in TX. If the states want stuff, let them tax and build it. The federal gov. has, IMHO, some specific duties. Protect the people. Promote Commerce. Regulate trade, and maybe a few other's I missed in government. IMO, all others are Politicians buying votes to remain in power. Roads and Bridges, tough question, but if they are in cities, the are State projects, If you want to designate the 'Federal Road System' OK, but it does not include roads that are obviously not interstate roads.

And, my taxable income was $13,300. So if yours was higher, then I will expect a check. Let me know and I'll send you the address.

[ERD50]

Just to be clear - I didn't send this thread down the old "redistribution of wealth" path (at least not *this* time ). I'm taking a vacation from that subject, for an undetermined time.

I only said that the amount of tax spending should be no greater than the need, we shouldn't spend just because we can collect it.

Quote:

Originally Posted by Rustic23 ERD50 I will not vote for any politician that talks about raising Corporate Taxes, as if we don't pay those. Either the politician is stupid or deceitful.

Rustic23, you are underestimating our politicians. They can be *both* stupid and deceitful.

Our current (as of 8:52PM CT today) Governor of Illinois appears to be on the high end of the deceit scale, and he also tried to increase corporate taxes in our State, as if it was some kind of free lunch. Amazingly, he was taken to task for that - which seems inconsistent with the general view of "tax those mean old greedy corporations" (that provide us our jobs and products we buy, and pass the cost of taxes onto us anyway).

Oh well, I gotta go work on my taxes...

-ERD50

[Rustic23]

I actually had a CPA tell me that it was OK, if they increased Corporate Taxes, just as long as they did not increase her income tax. She was serious!

[Texarkandy]

Quote:

Originally Posted by Rustic23 OK, well I did, give you a link as a place to start, and I doubt that we would agree on much. But here goes: Everybody should pay income tax. Lower class, middle class, upperclass and all in between. And, before you say it, I don't count payroll tax! Cut government spending. While it is not the smart way, just cut every agency a percentage. A better way is to say the Federal budget must be cut by X% and force the agency to live within strict budgets. If you can't live with that just cut everything 10%. Everyone of the agencies will survive and thrive. Cut duplicate programs. As pointed out in the article there are 27 different agencies/programs dealing with teen pregnancies. Certainly we can get by with 26! Re-examine the entire roll of Federal government. Education is not a federal job. Unless you are one that can find just about anything in the constitution. For the first 200 years or so, education was the purview of local government, not even the state. The education bureaucracy continues to grow every year. Cut out Federal subsidies. Yep, farm, air line, energy, wooden arrows, you name it, stop spending my and your money on it. I can live with my cow dying, and I'll bet you can live with it when yours does. Curtailing Federal spending hurts only one group of people. POLITICIANS! Your and my representatives and senators believe it is their duty to bring home the pork, and they are rewarded for it. Your fault and mine. Do you really think that the Federal Government can't get by on last year's budget with no increase, not even for inflation? Do you really think the 850B is going to create jobs? Do you really think it has to be passed in the next 3 days when most of the money will not be spent for about 2 years? Do you really think the country can go on stealing from the rich to give to the not so rich? Stop spending Federal Dollars on State projects. If Las Vegas wants a museum to Gamblers let them build it. Why did Texas dollars go to build the Rock and Roll Hall of Fame in IL. Why did CA money go to build a theater in TX. If the states want stuff, let them tax and build it. The federal gov. has, IMHO, some specific duties. Protect the people. Promote Commerce. Regulate trade, and maybe a few other's I missed in government. IMO, all others are Politicians buying votes to remain in power. Roads and Bridges, tough question, but if they are in cities, the are State projects, If you want to designate the 'Federal Road System' OK, but it does not include roads that are obviously not interstate roads.

You've got my vote
(of course so did Ron Paul - in the Texas Primary anyway - my conscience forced me to throw away my vote on the Libertarian in the General - the Republicans are welcome to try to win me back anytime)

Quote:

Originally Posted by Rustic23 And, my taxable income was $13,300. So if yours was higher, then I will expect a check. Let me know and I'll send you the address.

My fed income taxes alone this year are higher than that. (However I'll be sending the check in to Uncle Sam on Apr 15 for further redistribution in lieu of making direct payments to individuals myself.)

[Texarkandy]

Quote:

Originally Posted by eridanus We can start with cutting the pensions and retiree health benefits of federal employees.

Reagan already did that in 1984. Would you cut those for military retirees also?

Have you any idea how much of the federal budget federal pensions & retiree health benefits represent?
(6% - and that includes military veterans) http://www.cbpp.org/4-14-08tax.htm

Perhaps instead we should consider cutting things that are not akin to contractual obligations to employees & do not destroy federal employees faith & trust in their employer - causing them to go to higher paying positions in the private sector & being replaced by civil servants with the morals & work ethic of civil servants in Mexico.

If you really want to cut federal expenses related to employees - let's cut the number of departments & employees.

Ummm, ok now - what was this thread about?

[target2019]

Quote:

Originally Posted by stephenandrew Not sure who is right (I hate to admit it, but normally she is about most things), but it reinforced to me that two reasonable (I think) people can see the same facts and have two vastly different reactions.

Over the past weekend I looked at family income statistics for the US. My wife and I are in the 89th percentile. My son is on his own, and his first job has him in the 75th percentile. I could go on and on with reasons why I don't mind paying taxes. Sure, I'd like to pay less, but know disabled vets, single mothers, working poor and members of my own family who've benifited from gov't loans, state subsidies for drugs, and so on.

[Rustic23]

This thread would be quickly heading for the Soap Box, well if there was a Soap Box.

On one side are folks that believe it is OK, in fact desirable for Government to take ones money and give it to someone else, and the more money that person makes the more the government should take.

On the other side are folks that believe that Government does not have that right, and that, in fact, it is not desirable.

Old saying. 'Don't tax you, Don't tax me, Tax that other guy behind the tree!'

[Texarkandy]

Quote:

Originally Posted by Rustic23 .... On one side are folks that believe it is OK, in fact desirable for Government to take ones money and give it to someone else, and the more money that person makes the more the government should take. On the other side are folks that believe that Government does not have that right, and that, in fact, it is not desirable. ......

And of course there are those in the middle.

For now it seems a slight majority of the citizenry has decided to try out a government of the first of those two - for awhile at least.

So the real question for me then is - how do I work that system to my advantage in the pursuit of personal FI/RE?