Republican U.S. presidential candidate Rand Paul is proposing that businesses and individual Americans pay a federal flat tax of 14.5 percent in a plan that would cut the government's tax revenue by more than $2 trillion over 10 years.
The Kentucky senator's plan, which he describes in a Wall Street Journal's opinion piece being published on Thursday, would establish a 14.5 percent flat-rate tax applied equally to all personal income, including wages, salaries, dividends, capital gains, rents and interest.
All deductions except for a mortgage and charities would be eliminated under the proposal. Paul said the first $50,000 of income for a family of four would not be taxed and that for low-income working families, the plan would retain the earned-income tax credit.
"My tax plan would blow up the tax code and start over," Paul wrote.
His proposal also would eliminate the payroll tax on workers and several federal taxes including gift and estate taxes, telephone taxes and all duties and tariffs.
He said he would also apply a uniform 14.5 percent business-activity tax on all companies, down from as high as nearly 40 percent for small businesses and 35 percent for corporations.
http://www.reuters.com/article/2015/06/18/us-usa-election-paul-idUSKBN0OY05O20150618
I don't hate it though I fail to see why gifts and estates shouldn't be taxed and don't agree that the mortgage and charity deductions should be maintained if all others are eliminated. But I think the proposal itself is not a bad starting point for discussion.
So discuss.
Originally posted by no1marauderHe had me at "blow up the tax code and start over."
Republican U.S. presidential candidate Rand Paul is proposing that businesses and individual Americans pay a federal flat tax of 14.5 percent in a plan that would cut the government's tax revenue by more than $2 trillion over 10 years.
The Kentucky senator's plan, which he describes in a Wall Street Journal's opinion piece being published on Thursday, ...[text shortened]... ated. But I think the proposal itself is not a bad starting point for discussion.
So discuss.
Originally posted by no1marauder" ....cut the government's tax revenue by more than $2 trillion over 10 years."
Republican U.S. presidential candidate Rand Paul is proposing that businesses and individual Americans pay a federal flat tax of 14.5 percent in a plan that would cut the government's tax revenue by more than $2 trillion over 10 years.
The Kentucky senator's plan, which he describes in a Wall Street Journal's opinion piece being published on Thursday, ...[text shortened]... ated. But I think the proposal itself is not a bad starting point for discussion.
So discuss.
I want to hear what Paul is going to cut from the budget. My guess is not defense and not corporate welfare. Rather it will be goodby to Medicare, Medicaid, Social Security, research, education. It is a prescription that can only appeal to the dumb and dumber in the U.S. Given that public education and the testing of children is rapidly being taken over by the private sector, we can expect a further decline in the literacy of the population. The U.S. is doomed to failure.
Originally posted by PhrannyThe issue of what to cut is separate from the tax plan itself.
" ....cut the government's tax revenue by more than $2 trillion over 10 years."
I want to hear what Paul is going to cut from the budget. My guess is not defense and not corporate welfare. Rather it will be goodby to Medicare, Medicaid, Social Security, research, education. It is a prescription that can only appeal to the dumb and dumber in the U.S. Giv ...[text shortened]... can expect a further decline in the literacy of the population. The U.S. is doomed to failure.
I'm sure we could easily save more than $200 billion a year by ending the "War on Terror" for example.
Originally posted by no1marauderThe details (i.e., the numbers Paul chose) are just a footnote. It's mainly a philosophical issue: should the tax code be used to engineer social policy?
Republican U.S. presidential candidate Rand Paul is proposing that businesses and individual Americans pay a federal flat tax of 14.5 percent in a plan that would cut the government's tax revenue by more than $2 trillion over 10 years.
The Kentucky senator's plan, which he describes in a Wall Street Journal's opinion piece being published on Thursday, ...[text shortened]... ated. But I think the proposal itself is not a bad starting point for discussion.
So discuss.
Paul obviously doesn't think so. I say it's okay. For example, tax credits or deductions for people insulating their homes or installing solar panels would be eliminated under Paul's proposal. Is it a bad thing that the government can use the tax code to encourage environmentally friendly behavior? I don't think so.
The problem with the tax code, in my view, is that it has a lot of bad policy in it, not that it's too complicated or unfair.
In general, even if you want to cut deductions and exemptions, a progressive system makes more sense than a flat tax.
Originally posted by sh76The big problem with the current tax code, which is supposedly progressive, is the loopholes that enable corporations and the rich to not pay their fair share.
The details (i.e., the numbers Paul chose) are just a footnote. It's mainly a philosophical issue: should the tax code be used to engineer social policy?
Paul obviously doesn't think so. I say it's okay. For example, tax credits or deductions for people insulating their homes or installing solar panels would be eliminated under Paul's proposal. Is it a bad t ...[text shortened]... ou want to cut deductions and exemptions, a progressive system makes more sense than a flat tax.
Originally posted by sh76The problem with the system is that it allows the government to "sell" favors. The government gives its favorite groups favorable tax treatment. While sometimes a tax break may be legitimate, the perception often (including by many on this site) is that individuals who are connected can avoid their fair share of taxes through loopholes. Besides being fairer a flat tax could help avoid the influence of lobbying.
An overly simplistic assertion, but if so, the remedy is to close the loophole, not dump the system.