Tax Reform

[evilanne]

Here's a novel idea. Everyone top to bottom pays their fair share. No loopholes, no deductions, just straight up flat rates for 3-4 tax brackets. I make X income, I pay Y percentage of taxes as determined by my tax bracket.
The tax code would fit on 2 pages.
No more free rides. For anyone.

The only problem is all the socio-economic programs built into the current tax law. e.g. the Earned Income Credit often results in lower income earners paying little or no tax. Combined with other credits, some get substantially more refunded to them than withheld from their paychecks.

 

[konakathy]

Here's a novel idea. Everyone top to bottom pays their fair share. No loopholes, no deductions, just straight up flat rates for 3-4 tax brackets. I make X income, I pay Y percentage of taxes as determined by my tax bracket.
The tax code would fit on 2 pages.
No more free rides. For anyone.

That sounds great RC, but you have a sitting president who bragged about not paying any federal taxes and since he won't show us his taxes, we have no way of knowing if that's true. So, I would assume by what he's bragged about, he won't be signing any tax reform bill soon. It will be just the same as it ever was.

 

[RazorCat]

Here's a novel idea. Everyone top to bottom pays their fair share. No loopholes, no deductions, just straight up flat rates for 3-4 tax brackets. I make X income, I pay Y percentage of taxes as determined by my tax bracket.
The tax code would fit on 2 pages.
No more free rides. For anyone.

 

[Scout333]

An interesting article that talks about how tricky it is to redo the tax code.
Meaning that for our investment purposes, any of us banking on new tax legislation soon as a reason for stocks continuing to rise, might be in for a rude awakening...this could take a LOT longer to do (if at all).

[h=1]Can Trump and Congress Solve the Rubik’s Cube of Tax Reform?[/h]https://www.nytimes.com/2017/04/11/...sNext&contentID=WhatsNext&pgtype=article&_r=0

Tax Reform is easy IF you focus on how much revenue you need. HOWEVER, the Tax Code is a political instrument crafted largely by lobbyists representing large interest groups. To get everyone on board you have to give something to all the interest groups. Whether it makes sense or not. Which is why we have thousands of pages of tax code and regulations. Again to make this work we need to focus on the amount of revenue needed. What happens then is there is a direct correlation between the cost to each taxpayer and the benefits received. Everyone should pay something so they have some skin in the game. No free rides. Sorry for the soapbox. I just get irked when Tax Reform comes up and it is only more freebies for us to pay for.

 

[nnuut]

Real economists can't get it right now someone has it all figured out. Big companies and Big Loopholes will be a thing of the past. At 15% they will be paying more than they do now.

 

[FireWeatherMet]

However, with those low tax rates from 1913 thru the 1920's, it was like being on steroids then dying of liver disiease at age 40 with the Great Depression/Crash in the late 1920's thru the 30's.

Since then, when the top rate was 91% from 1947 thru 1961, we had massive economic expansion of the 1950's and nearly balanced budgets.

From 1961 thru 1981 the top rate was 70%...deficits were relatively small, strong economic expansion from the 1960's thru the mid 1970's, undone by Nixons price freeze and Oil Embargo.

From 1981 thru 1986 the top rate was 50% and even though we had the strongest Recession since the Great Depression from 1981 to 1982, the economy had strong growth under that 50% top tax rate for several years in the mid 1980's.

From 1987 thru 1991 top rate was reduced to 28% and growth flattened out, and we entered a mild recession in the early 1990's...and tripled the National Debt.

From 1994 thru 2000 the top rate was raised to near 40%, and we had the strongest economic expansion and deficit reduction in modern history.

From 2001 thru 2003 the top rate was reduced to 36% and we went into recession.

From 2013 the top rate went back up to 40% and we continued strong economic growth, adding Millions of new jobs, reducing the deficit every year, and havng the unemployment rate go down towards 4.6%.

The bottom line...lowering taxes has NOTHING to do with economic growth...just growing deficits and an acceleration towards Recession.

 

[tsptalk]

 

[nnuut]

Yes We CAN!!

 

[FireWeatherMet]

An interesting article that talks about how tricky it is to redo the tax code.
Meaning that for our investment purposes, any of us banking on new tax legislation soon as a reason for stocks continuing to rise, might be in for a rude awakening...this could take a LOT longer to do (if at all).

[h=1]Can Trump and Congress Solve the Rubik’s Cube of Tax Reform?[/h]https://www.nytimes.com/2017/04/11/...sNext&contentID=WhatsNext&pgtype=article&_r=0