America’s biggest fiscal challenge is excessive government spending. The public sector is far too large today and it is projected to get much bigger in coming decades. But the corrupt and punitive internal revenue code is second on the list of fiscal problems. This new video, narrated by yours truly and produced by the Center for Freedom and Prosperity, explains how a flat tax would work and why it would promote growth and fairness.
There are two big hurdles that must be overcome to achieve tax reform. The first obstacle is that the class-warfare crowd wants the tax code to penalize success with high tax rates. That issue is addressed in the video in a couple of ways. I explain that fairness should be defined as treating all people equally, and I also point out that upper-income taxpayers are far more likely to benefit from all the deductions, credits, exemptions, preferences, and other loopholes in the tax code. The second obstacle, which is more of an inside-the-beltway issue, is that the current tax system is very rewarding for the iron triangle of lobbyists, politicians, and bureaucrats (or maybe iron rectangle if we include the tax preparation industry). There are tens of thousands of people who make very generous salaries precisely because the tax code is a playground for corrupt deal making. A flat tax for these folks would be like kryptonite for Superman. But more than two dozen nations around the world have implemented a flat tax, so hope springs eternal.
Talking about punishing the “rich”, often just for the sake of it. Here’s a factoid.
Punish the rich, even if it costs the IRS more:
The IRS admits that it costs them less to process an electronically filed tax return. Yet they charge you for the service if you make more than 57K.
So the purpose is what? To punish the rich (well… those making more than 57K)? By making them either pay a fee or go through the trouble of filing a paper tax return; EVEN IF doing so obviously results in less revenue being collected because of the extra IRS cost. I guess “another matter of fairness…”
Excellent Video. This is not rocket science regarding how IRS operates.
But, who pays attention to the IRS? Only during tax time and thats when people scream and shout. Blame the Government
[...] an avid supporter of a flat tax and market pricing, I have no objection to these policies. Indeed, I would love to get rid of the [...]
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[...] image. Leading up to this slide, I talk about the Armey/Forbes flat tax and explain that it would eliminate the corrupt internal revenue code and replace it with a simple 10-line postcard. But I then warn that simplicity is not the same as low taxes and show the Obama [...]
[...] image. Leading up to this slide, I talk about the Armey/Forbes flat tax and explain that it would eliminate the corrupt internal revenue code and replace it with a simple 10-line postcard. But I then warn that simplicity is not the same as low taxes and show the Obama [...]
[...] image. Leading up to this slide, I talk about the Armey/Forbes flat tax and explain that it would eliminate the corrupt internal revenue code and replace it with a simple 10-line postcard. But I then warn that simplicity is not the same as low taxes and show the Obama [...]
[...] image. Leading up to this slide, I talk about the Armey/Forbes flat tax and explain that it would eliminate the corrupt internal revenue code and replace it with a simple 10-line postcard. But I then warn that simplicity is not the same as low taxes and show the Obama [...]
[...] image. Leading up to this slide, I talk about the Armey/Forbes flat tax and explain that it would eliminate the corrupt internal revenue code and replace it with a simple 10-line postcard. But I then warn that simplicity is not the same as low taxes and show the Obama [...]
[...] Yet rogue IRS bureaucrats want to impose a regulation to overturn the outcome of the democratic process. Heck, if they really think they have that sort of power, why don’t they do us a favor and unilaterally junk the entire internal revenue code and give us a flat tax? [...]
[...] Yet rogue IRS bureaucrats want to impose a regulation to overturn the outcome of the democratic process. Heck, if they really think they have that sort of power, why don’t they do us a favor and unilaterally junk the entire internal revenue code and give us a flat tax? [...]
[...] Why does this mess exist? The simple answer is that politicians benefit from the current mess, using their power over tax laws to raise campaign cash, reward friends, punish enemies, and play politics. This argument certainly has merit, and it definitely helps explain why the political class is so hostile to a simple and fair flat tax. [...]
[...] Why does this mess exist? The simple answer is that politicians benefit from the current mess, using their power over tax laws to raise campaign cash, reward friends, punish enemies, and play politics. This argument certainly has merit, and it definitely helps explain why the political class is so hostile to a simple and fair flat tax. [...]
[...] Why does this mess exist? The simple answer is that politicians benefit from the current mess, using their power over tax laws to raise campaign cash, reward friends, punish enemies, and play politics. This argument certainly has merit, and it definitely helps explain why the political class is so hostile to a simple and fair flat tax. [...]
[...] Why does this mess exist? The simple answer is that politicians benefit from the current mess, using their power over tax laws to raise campaign cash, reward friends, punish enemies, and play politics. This argument certainly has merit, and it definitely helps explain why the political class is so hostile to a simple and fair flat tax. [...]
[...] Why does this mess exist? The simple answer is that politicians benefit from the current mess, using their power over tax laws to raise campaign cash, reward friends, punish enemies, and play politics. This argument certainly has merit, and it definitely helps explain why the political class is so hostile to a simple and fair flat tax. [...]
[...] Why does this mess exist? The simple answer is that politicians benefit from the current mess, using their power over tax laws to raise campaign cash, reward friends, punish enemies, and play politics. This argument certainly has merit, and it definitely helps explain why the political class is so hostile to a simple and fair flat tax. [...]
[...] this desire for administrative simplicity is why the flat tax adopts the latter approach (this choice does not exist with a national sales tax since the [...]
[...] this desire for administrative simplicity is why the flat tax adopts the latter approach (this choice does not exist with a national sales tax since the [...]
All the GOVT. knows what to is spent money;not make it.The cash cow is over: The flat tax is the way to go. If the money is not there they can not spend it///
[...] alternative approach, by contrast, seeks better compliance by lowering tax rates and reforming/simplifying tax systems. This course of action boosts compliance by making evasion and avoidance less attractive. People [...]
[...] alternative approach, by contrast, seeks better compliance by lowering tax rates and reforming/simplifying tax systems. This course of action boosts compliance by making evasion and avoidance less attractive. People [...]
[...] alternative approach, by contrast, seeks better compliance by lowering tax rates and reforming/simplifying tax systems. This course of action boosts compliance by making evasion and avoidance less attractive. People [...]
[...] alternative approach, by contrast, seeks better compliance by lowering tax rates and reforming/simplifying tax systems. This course of action boosts compliance by making evasion and avoidance less attractive. People [...]
[...] alternative approach, by contrast, seeks better compliance by lowering tax rates and reforming/simplifying tax systems. This course of action boosts compliance by making evasion and avoidance less attractive. People [...]
[...] alternative approach, by contrast, seeks better compliance by lowering tax rates and reforming/simplifying tax systems. This course of action boosts compliance by making evasion and avoidance less attractive. People [...]
[...] alternative approach, by contrast, seeks better compliance by lowering tax rates and reforming/simplifying tax systems. This course of action boosts compliance by making evasion and avoidance less attractive. People [...]
[...] alternative approach, by contrast, seeks better compliance by lowering tax rates and reforming/simplifying tax systems. This course of action boosts compliance by making evasion and avoidance less attractive. People [...]
[...] readers occasionally give me a hard time about devoting a lot of time and effort to promoting the flat tax, while not paying enough attention to the national sales tax. I’ve explained that this is [...]
[...] Ideally, we should junk the corrupt internal revenue code (and the corporate side of the tax code makes the personal tax code seem simple by comparison) and replace it with a simple and transparent system such as the flat tax. [...]
[...] Ideally, we should junk the corrupt internal revenue code (and the corporate side of the tax code makes the personal tax code seem simple by comparison) and replace it with a simple and transparent system such as the flat tax. [...]
[...] complicated disgrace that manages to both undermine growth and promote corruption. The answer is a simple and fair flat tax, and Ryan’s plan will take an important step in that direction with lower tax rates, less [...]
[...] complicated disgrace that manages to both undermine growth and promote corruption. The answer is a simple and fair flat tax, and Ryan’s plan will take an important step in that direction with lower tax rates, less [...]
it seems like the flat tax proposal is really two things: a simplification of the code/removal of loopholes and giving everyone the same rate.
would it be possible to get the benefits of removing the loopholes and simplifying the code while still having a progressive tax structure? this video makes a good argument for the former, but does not focus enough on the latter.
[...] complicated disgrace that manages to both undermine growth and promote corruption. The answer is a simple and fair flat tax, and Ryan's plan will take an important step in that direction with lower tax rates, less double [...]
[...] complicated disgrace that manages to both undermine growth and promote corruption. The answer is a simple and fair flat tax, and Ryan’s plan will take an important step in that direction with lower tax rates, less double [...]
[...] Yet rogue IRS bureaucrats want to impose a regulation to overturn the outcome of the democratic process. Heck, if they really think they have that sort of power, why don’t they do us a favor and unilaterally junk the entire internal revenue code and give us a flat tax? [...]
[...] been a big proponent of the flat tax, which would mean one low tax rate, no double taxation of savings, and no corrupt loopholes. But [...]
[...] been a big proponent of the flat tax, which would mean one low tax rate, no double taxation of savings, and no corrupt loopholes. But [...]
[...] P.S. It’s also important to understand that a “deduction” in the business tax code does not imply loophole. If you remember the correct definition of business income (total revenue minus total costs), this means a business gets to “deduct” its expenses (such as wages paid to workers) from total revenue to determine taxable income. Some deductions are loopholes, of course, which is why a simple, fair, and honest system should be based on cash flow. Which is how business are treated under the flat tax. [...]
[...] P.S. It’s also important to understand that a “deduction” in the business tax code does not imply loophole. If you remember the correct definition of business income (total revenue minus total costs), this means a business gets to “deduct” its expenses (such as wages paid to workers) from total revenue to determine taxable income. Some deductions are loopholes, of course, which is why a simple, fair, and honest system should be based on cash flow. Which is how business are treated under the flat tax. [...]
[...] fair, and honest system should be based on cash flow. Which is how business are treated under the flat tax. Daniel J. Mitchell • April 28, 2011 @ 8:49 am Filed under: Government and [...]
[...] even if lawmakers have good motives (i.e., pursuing real tax reform such as the flat tax) when looking to get rid of special tax breaks, they need to understand what’s actually a [...]
[...] even if lawmakers have good motives (i.e., pursuing real tax reform such as the flat tax) when looking to get rid of special tax breaks, they need to understand what’s actually a [...]
I’d like to take an opportunity to offer a criticism of a consumption-based tax: First, consumption is the flip-side of production, so a consumption-based tax is little more than an income tax in reverse; in fact, it really is just an income tax with a savings deduction. While taxing consumption instead of production might seem reasonable, even more economically efficient, I fear that to do so – especially in today’s age – would further invite importers that can undercut domestic producers.
Another reason I often hear bandied about is that it would bring black market dollars into government coffers, but that argument is disingenuous: buyers of illicit goods buy them with after-tax dollars (unless they’ve found a way to deduct their cost!). If I have to earn $120 to buy $100 dollars of illegal goods or services, then simply switching to a consumption-based tax (assuming the provider of said illegal goods and services collects sales tax, which I find dubious) shifts the tax revenue from the buyer to the seller; it doesn’t create “new” revenue.
Another reason I am skeptical of a consumption-based tax, the FairTax especially, is that it offers “pre-bates”. This ties in to your video presentation: I am inclined to reject any tax system that provides refundable credits, either to individuals or companies. You mentioned a refund on the individual tax “card” (well played!, BTW). Does this include any form of the EIC? I am also not sure how to treat business losses, especially given calendar-year limitations.
I appreciate any feedback.
[...] good example of why we should junk the corrupt, punitive, and unfair tax code and replace it with a simple flat tax. With no double taxation and a single, low tax rate, we would know that rich people were paying the [...]
[...] good example of why we should junk the corrupt, punitive, and unfair tax code and replace it with a simple flat tax. With no double taxation and a single, low tax rate, we would know that rich people were paying the [...]
[...] good example of why we should junk the corrupt, punitive, and unfair tax code and replace it with a simple flat tax. With no double taxation and a single, low tax rate, we would know that rich people were paying the [...]
[...] good example of why we should junk the corrupt, punitive, and unfair tax code and replace it with a simple flat tax. With no double taxation and a single, low tax rate, we would know that rich people were paying the [...]
Lawyers and CPAs who spent tons of money, time and effort to build careers feel threatened by the flat tax. Large numbers of universities and other educational institutions have huge programs and many faculty who make their living teaching others the tax code and legal matters. Please make a video explaining the impact on them. Would the flat tax be implemented immediately on one fixed, effective date or be phased into use? Does the government assist them in building new careers and moving to new locales, or are they simply left to do this on their own “one fine day?”
[...] well done. Given my video on the flat tax, as well as my video on the global flat tax revolution, you probably are not surprised by my [...]
[...] the benefit of real tax reform such as a flat tax. You get a low tax rate, but you also get rid of double taxation so that the IRS only gets one bit [...]
[...] been a big proponent of the flat tax, which would mean one low tax rate, no double taxation of savings, and no corrupt loopholes. But [...]
http://arch.eece.maine.edu/ece473/index.php/All_New_Kidney_Diet,” Thanks for that awesome posting. It saved MUCH time
[...] been a big proponent of the flat tax, which would mean one low tax rate, no double taxation of savings, and no corrupt loopholes. But [...]
[...] For more information, here’s my flat tax video. [...]
[...] For more information, here’s my flat tax video. [...]
[...] When I think about taxes, my first instinct is to rip up the corrupt internal revenue code and implement a simple and fair flat tax. [...]
[...] noting at this point that FATCA only exists because of bad tax law. If the United States had a simple and fair flat tax, there would be no double taxation of income that is saved and invested. As such, the IRS [...]
[...] noting at this point that FATCA only exists because of bad tax law. If the United States had a simple and fair flat tax, there would be no double taxation of income that is saved and invested. As such, the IRS [...]
[...] noting at this point that FATCA only exists because of bad tax law. If the United States had a simple and fair flat tax, there would be no double taxation of income that is saved and invested. As such, the IRS [...]
[...] noting at this point that FATCA only exists because of bad tax law. If the United States had a simple and fair flat tax, there would be no double taxation of income that is saved and invested. As such, the IRS [...]
[...] fairness doesn’t mean treating everyone equally by adopting a flat tax. Instead, it means a class-warfare policy of higher tax [...]