[Bas]

Why is it that the most rich people pay the least tax in the world?

Because they have enough money to buy a house in a tiny state in which they don't have to pay income tax. Because they have enough money to never ever have to work, often fortunes that have been within their families for generations, they don't have to commute to work every day. And if they do, they have a parttime job that pays millions which they got through pulling some political strings and commute with a private jet from their tax paradise to wherever their "job" is.

Should these little islands in the pacific and carribean, and in Europe the village states, be forced to comply with an international minimum of capital and income taxes?

[cynicalheretic]

Personally, I think that no one should have to pay taxes.

[Bas]

$this->bbcode_second_pass_quote('cynicalheretic', 'P')ersonally, I think that no one should have to pay taxes.

[Jack]

$this->bbcode_second_pass_quote('Bas', 'S')hould these little islands in the pacific and carribean, and in Europe the village states, be forced to comply with an international minimum of capital and income taxes?

[Tyler_JC]

Rather than violate sovereignty laws and dictate what these countries should and should not tax, we should consider changing our tax laws so that the super wealthy can't use these tax shelters.

Maybe require that all income regardless of origin be taxed at the same rate?

If you want to be a US citizen, you must pay taxes on at least X% of your income?

Connecting citizenship to taxpaying would be extremely helpful for getting rid of tax loopholes.

So unless someone is actually a citizen of the Cayman Islands or wherever, they won't be able to escape paying their "fair share".

[Bas]

$this->bbcode_second_pass_quote('Tyler_JC', 'R')ather than violate sovereignty laws and dictate what these countries should and should not tax,

[Jack]

$this->bbcode_second_pass_quote('Bas', '
')these countries are so tiny they are better qualified as pirates nests IMO

[Kingcoal]

When it was first adopted, the income tax was sold as a way to tax the rich. The Carnegies and Rockefellers were making fantastic incomes and there was a lot of jealousy. So the system was born of class warfare. The detractors said that giving the government such authority was dangerous because eventually the rich would learn how to avoid it leaving the average citizen with the bill. Well, that's basically what has happened. It's not just the US that has this problem. The Rolling Stones and U2 have avoided almost all income taxes by forming shell companies in The Netherlands.

The solution to the problem in the US is simple; reduce the size of the federal government. That's what Reagan tried to do, to no avail. Get rid of all federal entitlement programs and you could get rid of the income tax and have money left over. Then you wouldn't have to worry about collecting it, which right now costs about $190 billion/year. Let State and Local governments decide if they want to tax people and provide entitlement programs. Just think about it; say you pay $170 per week in payroll tax. Do you care whether that goes to the federal government or your local government? If I had a choice, I'd rather my money go to my locality.

In my opinion, entitlement programs are unconstitutional anyway. Public money is public money and not to be given out to private citizens unless those citizens are in the employ of the government.

[Tyler_JC]

So if Bono is not a US citizen...why should we care if he pays Ameircan taxes or not?

We can tax his concerts, CDs, real estate, etc.

But his offsource royalties are not a concern of the IRS if he isn't even a permanent resident.

I say we let the Irish worry about U2's perfectly legal tax avoidance.

Granted, Bono is a HUGE hypocrite for trying to lower his own tax burden and then whining that the rich don't pay enough in taxes.

Secondly, US corporate income taxes account for only 8% of federal revenue.

I strongly believe that we should completely eliminate the federal corporate income tax and replace it with higher taxes on those earning over $1 million.

If companies no longer had to move overseas to avoid paying taxes, there would certainly be economic benefits to the United States.

In fact, lowering the corporate income tax would probably increase total federal revenue because so many new jobs would be created in the United States.

If you can't beat the tax havens...why not join them?

[Kylon]

I think you should have "job taxes". If you have a job that pays X many millions of dollars, you should be taxed on that job, even if your not an American citizen.

If your job is in the United States, and it brings you 20 million dollars a year, or 45 million a year, then that money should be taxed, regardless of what nationality you belong too.

If the money is made in the U.S, it should be subject to a U.S flat tax.

Furthermore, the only loopholes that should be available to get out of the U.S flat tax is re-investment in the company, and tax breaks providing jobs for disabled people. That's it.

Also, money that you re-invest should be subject to "financial scrutiny". Which means that if the IRS looks at your balance sheet, and you re-invested 5,000 dollars, in making sure that the Executives get premium latees, you can be taken to court. If the investment is a "valid" investment, such as something that will further contribute to the production of wealth for the company, then the charges can be dismissed. However, if the investment is an "invalid" investment, then the people in charge can go to jail for cooking the books.

That's how I think we should re-write our tax laws. If we did it that way, we could have alot more revenue for the government.

[jdmartin]

Simplest system and solution:

Flat tax of XX percent (let's say 15% for arguments sake). Exempt all income below XX (lets say $30k for arguments sake) as the national poverty level. All income above 30k subject to 15%. All corporations doing business in the US required to register as "citizens" (after all, they're already recognized as 'people' by the Supreme Court ) and pay the same tax rate on income earned through transactions occuring within or amongst the US. No exemptions, loopholes, deductions, whatever. No separate 'FICA', 'Medicare' etc taxes.

This system would be immensely fair. Everyone would get the same poverty deduction, and would take home the same 85% of what they've earned.

But you'd have to do a lot of reformation. Social security would be reformed as a safety net, not an entitlement. Same thing for Medicare and a host of other programs. This would seriously reduce the need for income in the first place.

Never gonna happen, though. Too many people getting rich (or staying rich) off the current system.

[dissimulo]

I can't believe anyone is wasting their time trying to figure out how to put more money in the hands of government. Government needs less money. The less they have, the better for all of us.

Tax havens are over-rated anyway. In most countries, if you are a citizen, whether or not you are currently resident, you pay tax. As well, in most countries, if you are a non-citizen resident, you pay tax. Sure, you can optimize your situation by being a resident in a country where you can make a lot of money, while being a citizen of a country with low taxes, but you are not really escaping taxes.

In the US, if you reside and work in another country, you still pay US taxes; you just get to exempt the first $80K or so of income. However, you probably are still getting stuck paying taxes to your country of residence.

[Bas]

$this->bbcode_second_pass_quote('dissimulo', 'I') can't believe anyone is wasting their time trying to figure out how to put more money in the hands of government. Government needs less money. The less they have, the better for all of us.

[Tyler_JC]

We must also remember that many industries and jobs exist only thanks to flaws in the tax code.

Solar power is cheaper than it would be thanks to the "Residential Energy Tax Credit.

There are millions of Americans avoiding direct welfare right now thanks to the "Earned Income Tax Credit."

Millions of people can only afford to make their mortgage payments thanks to the "Mortgage Interest Deduction".

Last time we got rid of a major deduction in the 1980's we crashed the housing market and caused a massive recession...

So any tinkering with the tax code must be done very carefully.

[Bas]

good point tyler. Not too long ago, in this country, they abruptly stopped a subsidie sceme for farmers who wanted to build a windmill on their farm (the electricity generating kind, to be clear on that one LOL). Besides that it's stupid to stop that now it also left some farmers who were in the middle of a project high and dry.

Point being, if you are going to change the tax code, it should be announced well in advance and if possible should only be done gradually or in small steps so people and the economy can adjust without taking much damage.

Oh, and tyler, if these loopholes were closed but the general taxrates would be lower by the same amount as these now closed loopholes would bring in then it would probably generate more jobs in these more efficient sectors than ever existed thanks to the loopholes (because these are inefficient jobs, only able to exist because of an unfair advantage). And if it doesn't create more jobs, you can be sure as hell it produces more wealth than the "loophole jobs".

Change however, always goes accompagnied with (temporary) inefficiency, something that allows alot of these loopholes inconsistencies in the economy in general to go unchanged for long periods of times as the short term cost of change might be considered too big.

[Kingcoal]

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