Federal Tax Plan
By bobmnu
@bobmnu (8157)
United States
October 26, 2011 9:45am CST
With Gov. Perry's new 20% flat tax plan and Herman Cain's 9-9-9 plan or the present system with the IRS which plan do you favor. I have done some rough calculations using the different plans and found that my tax bill would be fairly close to what it is now. What I like about the Perry and Cain plans is the simplicity of them. I like the idea of the sales tax by Cain but think it is too high. The idea of a sales tax is that everyone pays it based on the amount they spend. IF I choose to buy a car that costs $25,000 that is what I pay taxes on and the rich person who is buying a $100,000 pays the tax on that amount. In effect the rich end up paying more than the middle class. The sales tax would also catch those who are working for cash to avoid paying income taxes. This way everyone would have an interest in how the government spends their money.
Which plan do you favor?
2 people like this
4 responses
@anniepa (27955)
• United States
17 Nov 11
I think we all probably agree the federal tax plan could be simplified but at the same time "simpler" isn't always necessarily "better". I've said for quite some time a national sales tax could probably work if it's done fairly, meaning if it doesn't punish the lower and middle income Americans. Without knowing every single detail, that's what I think both Cain and Perry's plans would do and my personal view is I could never support a plan, even if it benefited me, that would make things harder than they already are on low income families.
Annie
@bobmnu (8157)
• United States
22 Nov 11
The advantage of a national sales tax is that by setting it low you would not impact the lower income people but would catch the wealthy because they tend to spend more on non essential items. the sales tax has another advantage in that it is hard to avoid.
1 person likes this
@anniepa (27955)
• United States
23 Nov 11
It depends on how it's done whether it will impact low income people or not. I'd be totally opposed to a plan that did away with the EIC and added even a dime in sales taxes for the lower income workers unless they were given a sizable rebate. Also, items that are necessary should definitely not be taxed.
Annie
@jjzone44 (917)
• United States
26 Oct 11
I have not read all of the intricacies of both of the proposals, but I can tell you I favor any plan that collects most of it's revenue as a usage tax. Not only would you catch the rich when they purchase expensive goods or services, you would also nab the money from illegal sources as well. Besides the under-the-table workers, you'd potentially get some revenue from the traffickers when they purchases things as well.
Besides the increase in revenue sources, you would stop penalizing working folks who attempt to save money. Right now, any guaranteed income from savings is taxed at the moment it is earned, not used. People who invest in stocks are not taxed on capital gains until the money is actually removed from the stock market when stocks are sold.
One thing any plan has to address is the tax credit for mortgage loans. When a "flat tax" was discussed years ago, one of the components of that plan removed the mortgage tax credit. With the housing market already in severe disarray, we don't need to add to that problem by removing another benefit of home ownership.
@jjzone44 (917)
• United States
22 Nov 11
Renters don't pay property tax or mortgage premiums. Since renters don't pay those items, they can't get tax breaks for them. Private home ownership provides a stable investment for most people most of the time. New home construction provides many jobs all across the country, and working people pay taxes to contribute to the "pot" so to speak. If the current climate of real estate continues, the job market for construction and material is going to continue to be depressed, along with the tax income from it. Besides, municipalities and schools get a large part of their revenue from property tax, and the current real estate conditions have already impacted the local sector. To institute a tax plan that would not provide a benefit for owning a home would only serve to weaken the housing market even further. How would the local services be affected then? Local government does not get a guaranteed income stream from the federal government, and the only way to change that would be a move toward nationalization. That process would introduce a whole new set of problems.
@ParaTed2k (22940)
• Sheboygan, Wisconsin
26 Oct 11
One of the things I like about both plans is, everyone will feel the bite of the taxes they pay. No one will get complacent because they never see the money taken in taxes.
