Posted: Aug 12, 2011 6:53 am |
Edited by: Will
Two words: Flat tax. No loopholes, no write offs. EVERYONE (corps included) pay a flat _____% (insert number here, 15 % sounds good to me). Yes it is a regressive tax, but I think the big guys being held to the same standard as everyone else is about as fair as it will ever get.
I basically agree. That's assuming THERE ARE NO LOOPHOLES. As it is, our statutory corporate rates are rather high. BUT the fact remains many corporations exploit a variety of loopholes that allow them to pay an effective rate of 0%; and some even "pay" a NEGATIVE rate, allowing them to make money off of credits and deductions on top of their net profits:http://accounting-financial-tax.com/2011/06/12-big-yet-famous-corporat ions-pay-no-tax/
Are these corporations who are bilking the system with the blessing of their benefactors in Congress and the White House going to get behind lower statutory rates if and ONLY if it means their effective rates actually go up? I just don't see it happening.
And despite what we hear on FOX News and from talk radio, the nominal marginal rates on the extremely wealthy individuals not as bad as made out:
U.S. rates vs rest of world (US came in at number 37):http://www.nationmaster.com/graph/tax_hig_mar_tax_rat_ind_rat-highest- marginal-tax-rate-individual
Warren Buffet on how a variety of credits, deductions and sundry loopholes available to the very wealthy actually flattens out the *effective* rates across the income spectrum:
More fun stuff: http://www.frumforum.com/how-the-super-rich-scored-on-tax-day
Now, all that said, I could get behind a flat tax that wipes out ALL deductions, credits etc that have, along with unsustainable entitlements, compounded our deficit and debt woes. Even some of the most fiscally conservative economists* in our country have gone on record saying that our problem is spending AND lack of revenues. The difference between these guys and those in the halls of Congress or on talk radio is that these guys aren't looking for votes, nor do they get paid for partisan hackery.
*Bruce Bartlett (worked for Ron Paul and Ronald Reagan): http://economix.blogs.nytimes.com/2011/07/26/are-the-bush-tax-cuts-the -root-of-our-fiscal-problem/http://www.frumforum.com/ratings-agencies-also-want-to-see-bush-tax-c
David Stockman (worked for Reagan) & Greenspan (avowed Randite): http://money.cnn.com/2010/08/09/news/economy/elders_economy/i
Unfortunately I have very little faith that this is actually the way a flat tax would shake out. Those subsidies and loopholes are enormously popular, and are, from my vantage point, basically sold for campaign cash by a distressing majority of our elected officials. Also, there's a strident philosophy in DC and around the country that raising revenues, even when coupled with austerity measures in the interest of avoiding economic disaster, is still a net negative.