Personal Income Tax

[A18]

Why not replace it with a tax purely on businesses? It's the same people who pay; making it a personal income tax just shifts the burden onto the backs of employees.

[David S]

Why not replace it with a tax purely on businesses? It's the same people who pay; making it a personal income tax just shifts the burden onto the backs of employees.

That would put a $700 Billion burden on the back of American business which would make them even less competitive with companies in low cost countries. If you can find some way to apply a proportionate amount on imports it might be OK. It will increase the cost of products though so it would act like a sales tax in that respect.

[cwelsch]

And consumers.

[A18]

Why not replace it with a tax purely on businesses? It's the same people who pay; making it a personal income tax just shifts the burden onto the backs of employees.

That would put a $700 Billion burden on the back of American business which would make them even less competitive with companies in low cost countries. If you can find some way to apply a proportionate amount on imports it might be OK. It will increase the cost of products though so it would act like a sales tax in that respect.

This is exactly what I mean. We would of course have to put tarrifs on outside products to equal out the prices, but it would still be semi- free trade.

[Swing low, sweet chariot. Comin' for to carry me home.]

shun

[TeePee4Prez]

Ok, here'a good website for some of you poor GOPers.  Hey, Keystone, do you happen to have the e-mail address for that assinine O'Brien committeeperson?  If so, send him this link:

http://getthefacts.atspace.com/

[weallbleed]

South Dakota's tax system works pretty well. IT'd make a good model for a national one.

[TeePee4Prez]

South Dakota's tax system works pretty well. IT'd make a good model for a national one.

Don't know much about it.  Pennsylvania's stinks!  Philadelphia's even worse.

[Keystone Phil]

Ok, here'a good website for some of you poor GOPers.  Hey, Keystone, do you happen to have the e-mail address for that assinine O'Brien committeeperson?  If so, send him this link:

http://getthefacts.atspace.com/

You're one angry and rather pathetic person at times. You bash some old man who just happened to disagree with you. Yes, he's a Northeast Philadelphian who likes the Bush tax cut. GET OVER IT.

[TeePee4Prez]

No, I'm just voicing my opinion.  He's a fool and made fun of Mark after he lost.  He's sore and pathetic.

[Keystone Phil]

No, I'm just voicing my opinion.  He's a fool and made fun of Mark after he lost.  He's sore and pathetic.

He never made fun of Mark and I'm not arguing the debate on the forum. It's over and done with. If you want to argue it, please argue it off a board about taxes.

[TeePee4Prez]

No, I'm just voicing my opinion.  He's a fool and made fun of Mark after he lost.  He's sore and pathetic.

He never made fun of Mark and I'm not arguing the debate on the forum. It's over and done with. If you want to argue it, please argue it off a board about taxes.

Not during the debate!!  I was right there.

[cwelsch]

Putting the tax entirely on business would have two major effects, besides raising prices dramatically on consumers.

First, businesses would be the ones to deal with the paperwork, the IRS, the hassle, the ones to hire lawyers.  This is easier for us but it would be absolutely horrendous for small business owners.  It would also be unclear in its effects, since so many small business owners pay their busines taxes through the personal income tax system.  Either way, this would have to either exempt relatively small businesses or it would simply crowd them out of the market.  Even without the paperwork that would swamp small businesses, the added costs would be too great for most.  In the interests of economics, I'd have to discourage it on this point alone.

Second, it would hide the tax rate from us.  Even though we'd all be paying it in increased prices of goods and decreased business revenues, we'd feel as though taxes were zero.  We would have no problem raising taxes through the roof since we'd never directly feel the pinch.  Sure, higher taxes would definitely hurt us all since everybody buys goods, but we'd try to make businesses absorb the losses.  The result is we lose the current trade-off system, wherein increased program spending comes at the cost of increased taxation.  The growth of government power, influence and regulation would be much less limited, much less stifled.  It's actually critical that taxes be visible so everybody remembers how much the government is getting - and holds it accountable to provide services in return for all the money it takes from us.

If anything, we should eliminate all taxes besides the income tax and simplify the income tax so it can be easily filled out.  That way taxes take little work but we remember how much the government takes from our wallets each year.



Plus tax day should be on Election Day.

[Posterity]

Why not replace it with a tax purely on businesses? It's the same people who pay; making it a personal income tax just shifts the burden onto the backs of employees.

That would put a $700 Billion burden on the back of American business which would make them even less competitive with companies in low cost countries. If you can find some way to apply a proportionate amount on imports it might be OK. It will increase the cost of products though so it would act like a sales tax in that respect.

I don't agree with that exactly.  Businesses are already saddled with that burden because the wages that they pay employees include the income tax that the individuals have to pay.  Just because individuals are writing the checks to pay those taxes doesn't mean those taxes are not borne by businesses.

I think if the income tax was shifted 100% onto businesses, then there would be more pressure on the government to keep taxes low.  The cost of taxes would be much more visible (and painful for the businesses to pay) and businesses have the legal and financial resources to better lobby the government for lower taxes.  And small business owners are already paying individual income tax so I don't think there would be much difference (in cost or time) in filing a corporate income tax return instead.

And people seem to assume that businesses would just raise prices to cover whatever the additional costs might be.  I don't think that's entirely true either.  The cost of a product will still be determined by the laws of supply and demand and so businesses will only be able to charge what the market will bear.  If their costs go up, businesses will either have to settle for reduced profits, or more likely, be motivated to improve productivity.  That innovation would be good for the economy (in terms of new products and services to enable that increased productivity).

But regardless, if American businesses are to remain competitive in a global market, we have to drastically reduce the cost of doing business here in America.  And that includes reducing the income tax rates, whether they are paid by individuals or by businesses.

[David S]

The growth of government power, influence and regulation would be much less limited, much less stifled.  It's actually critical that taxes be visible so everybody remembers how much the government is getting - and holds it accountable to provide services in return for all the money it takes from us.

That's a good point. Maybe a good tax system would be one that causes equal agony to everyone. Then we would all have an interest in seeing to it that government is frugal with our tax dollars.