How about 0%(poverty line or below) - 18%(max for anyone) income tax and we forget all other taxes? Income happens when it is realized or upon transfer. I'm sure there's some other definitions that need to be added to this but this is the fairest way I can think of supporting savers, supporting investing, supporting small businesses, and allowing the wealthy to be taxed at a reasonable rate. This also incentivizes congress to actually grow the GDP and work within a budget.
That would likely significantly lower federal tax revenue and shift an even bigger burden of taxes onto lower income folks. We could adopt a graduated taxation system with 1000 gradients of slowly increasing brackets - as long as a computer can "if 18 < x AND x < 20" through the whole list having a reasonably progressive tax bracket system isn't a real cost - it's all the exemptions and BS that make things a pain... basically "I'm sure there's some other definitions that need to be added to this" is where the demons live in your idea - and they're big demons. The basic graduated tax brackets are as clear as water and trivial to implement.
I build software for a living - building a program to take a list of 1000 brackets and compute the graduated tax rate would take about fifteen minutes (in a vacuum).
This is not a real problem.
(In response to your edit)
Do you think accountants are currently working by slide rule? The tax code is currently extremely corrupted by loopholes and exceptions. My original hyperbolic statement was to highlight that the graduation of income tax is dirt simple. We've currently got seven tax brackets and it is trivial to calculate what you're going to owe based on them, even if we pushed seven to a thousand it's still a trivial calculation to run.
There's a lot of people who want the government to stay out of medicare ...
People might feel like not-heres-ville shouldn't get government funding for whatever project but when it comes to any less funding for heres-ville there will be complaints. Its basically reverse NIMBY. You think Iowans want the government to do less weather prediction or crop testing?
> How about 0%(poverty line or below) - 18%(max for anyone) income tax and we forget all other taxes?
How about no? How’d you pick those numbers and a two-tier system? (“Let’s set the top marginal rate of our only tax to approximately the lowest tax-to-GDP ratio of the OECD” is, I suppose, a choice, but its a very odd one.)
> Income happens when it is realized or upon transfer.
In any progressive (including a two-tier like this, which, while far less progressive than the status quo, is still technically a progressive system) system that brings LTCG in line with general income taxation, you also want to allow advance recognition (for sure) and maybe deferment of income spikes, otherwise you end up taxing income that takes multiple years and is nonrepeatable the same as current and repeatable ongoing income, which is unfair to people with irregular income through capital. Doing this, and applying equally to regular income, also is more fair for people with irregular non-capital income, which may be a less-common pattern, but definitely happens.
> this is the fairest way I can think of supporting savers, supporting investing, supporting small businesses, and allowing the wealthy to be taxed at a reasonable rate.
It radically cuts taxes on the wealthy, and "supports" all those things by cutting taxes on the wealthy people doing them. Its just a giant downward shift of net tax burden that also is a massive cut in overall tax revenue.
> This also incentivizes congress to actually grow the GDP and work within a budget.
No, it doesn’t. (I mean, there are incentives to both of those, especially the first, that exist independently, but this doesn’t add to any of them.)
This would cut US Government revenue by over 70%, and would not allow Social Security and Medicaid to be paid out, ignoring all other governmental programs. Nonstarter.
Who here looks at the current US government and thinks “this is working great, let’s have more of it?” Because that’s what more taxes does. It doesn’t fix deficiencies.
Didn’t take 5 minutes before the “roads are good” straw man emerged.
We've got some seriously great government programs. I won't stop you from criticizing the visible parts of the government (politicians can be quite frustrating) but Medicaid and Medicare are both extremely efficient and Social Security is basically why we have such a high expected lifespan. Personally, I am quite thankful for the roads, rail lines, sewage and all the other things living in a modern society gives us.
The construction of roads and rail lines though is enormously overpriced though. It's not like they'd just disappear if we stopped paying taxes.
Instead why not just pay for them directly and get _a lot_ more of them? What if your AAA membership built the actual roads you're driving on and you could buy an unlimited pass, or a pass based on your actual mileage or something like that?
Does your vision involve a single large government mandated corporation (i.e. like a crown corporation up here in Canada) or by individual private companies?
It doesn't take much of an imagination to see how poorly such a world would end up.
We don't need parallel highways built just so corporations can compete on who has the best roads.
And I'm imagining a scenario where one company sells their road network to another, and the new one decides they hate SUVs and so won't allow SUVs on their network, and suddenly my neighbor can't leave the neighborhood because he drives an SUV for work.
Not to mention the extreme number of tolls booths you might have to set up.
the government can figure out how pay interest on its borrowings any way it wants, its just not desperate enough to figure it out thanks to its rent seeking behavior
How can you possibly claim the income tax is on shaky legal ground when there's a Constitutional Amendment that explicitly makes it legal?
How far to the right do you have to go when you start considering the Constitution is shaky? I mean, yeah, people quibble over interpretations, but the 16th Amendment is pretty explicit.
> How far to the right do you have to go when you start considering the Constitution is shaky?
Not that far? For example, the GOP in Texas's Senate passed a law requiring the Commandments in public schools. I find that hard to view as anything other than direct contempt for the Establishment clause. The only pragmatic reading of such a law, should it become law, in today's political climate, is that it exists solely to be challenged, on the hopes that the Supreme Court will … IDK, strike that portion of the 1A or otherwise reinterpret it as completely ineffectual? The Establishment clause is also quite clear (though I grant, not as clear as the 16A, but not as vague as say, "A well regulated Militia" makes the 2A). That's not the only such law, or portion of the Constitution, either, though I'd certainly say it's one of the more clear ones…
